VIETNAM NATIONAL UNIVERSITY – HO CHI MINH CITY INTERNATIONAL UNIVERSITY DEPARTMENT OF INDUSTRIAL ENGINEERING & MANAGEMENT RELOCATING WAREHOUSE AND OPTIMIZING ROUTE FOR NUTRINEST Advisor: Trần Đức Vĩ Group Number: 45 Student name Student ID Contribution Đào Thị Hạnh Xuân IELSIU20222 100% Nguyễn Trần Xuân Thủy IELSIU20430 100% Phạm Minh Thắng IELSIU20413 100% 11/2023 TABLE OF CONTENTS CHAPTER 1: INTRODUCTION. Current system description. The gap needed to fill. Scope and limitation.
Scope and assumption. Current system investigation:. Detailed current system:. Investigate the current system:.
The delivery procedure:. Analysis of current system:. Considered solution directions. Suggested area of improvement.
Brief description of approach or tools for improvement. CHAPTER 3: SYSTEM DESIGN. Approaches comparison and selection. Advantage and disadvantage of the considered approaches.
Qualitative and quantitative comparison. Design structure of proposed system. Analyze and justify the techniques to be used. Key advantages of the proposed system design.
CHAPTER 4: PROTOTYPE DEVELOPMENT AND IMPLEMENTATION. Mathematical method: Analytic Hierarchy Process (AHP). Alternative and criteria selection. Mathematical model: Vehicle Routing Problem (VRP).
Table: The distance between warehouse and 5 given demand points. Mathematical method: Analytic Hierarchy Process (AHP). Changing the weight between Near the highway and Public security. Mathematical model: Vehicle Routing Problem (VRP).
Changing the capacity of two trucks. Changing the demand of store located in Tan Binh. Changing the demand of store located in Tan Phu. Analyze the environmental, social, and economic impacts.
2 LIST OF TABLES Table 1-1. Brief description of methods. Advantages and disadvantages of approaches. Indices, Parameters, and decision variables in AHP.
Scale of importance level. Preferred score of criteria. Priorities of criteria. Preferred score among regions in HCMC Alternatives under reasonable distance.
Priorities of regions in HCMC Alternatives under Near the highway. Preferred score among regions in HCMC Alternatives under Public security. Priorities of regions in HCMC alternatives under Public security. Preferred score among regions in HCMC Alternatives under Public security.
Priorities of regions in HCMC alternatives under Traffic density. Preferred score among regions in HCMC Alternatives under Maximum delivery radius: 210 km. Priorities of regions in HCMC alternatives under Maximum delivery radius: 210 km. Rank of 5 alternatives in HCMC.
Indices, parameters and decision variables in VRP. The distance between warehouse and 5 given demand points. Route of vehicle 1. Route of vehicle 2.
Preferred score of criteria. Priorities of criteria. Rank of 5 alternatives in HCMC. Route of vehicle 1 when changing the capacity.
Route of vehicle 2 when changing the capacity. Route of vehicle 1 when increasing Tan Binh’s demand. Route of vehicle 2 when increasing Tan Binh’s demand. Route of vehicle 1 when changing Tan Phu’s demand.
Route of vehicle 2 when changing Tan Phu’s demand. Motivation People are more concerned than ever about their health in order to improve quality of life, because poisonous foods can have unforeseen effects on health and cause interruptions in daily activities. Nutritious foods, on the other hand, will assist people enhance their health and lower their risk of disease. Among that, bird's nest is one of the meals that can help enhance resistance and immunity in people of all ages.
NutriNest is one of Vietnam's largest and most successful bird's nest manufacturing firms. NutriNest, the first bird's nest farming firm in Vietnam since 2005, was founded on research on bird's nest farming for nests. NutriNest has invested in and consulted on the development of over 500 bird's nest farm houses both at home and abroad. NutriNest's sophisticated, highly automated plant currently manufactures 25 different types of popular and high-end bird's nests and bird's nest drinks.
NutriNest intends to create more stores in Vietnam in order to raise awareness, develop its distribution network, and service clients as swiftly as possible. During the internship at NutriNest in the Binh Chieu industrial region, there were some issues with the distribution of bird nests to the branches in the south of Vietnam. The key goals of this research are to investigate the issues and give recommendations for change based on our findings. 4 Figure 1-1: Logo of NutriNest 1.
Current system description Optimizing warehouse site is one of the most significant decisions in logistics system design since a good location may assist minimize travel time, transportation costs, and make the process more convenient. NutriNest's warehouse is now located in the Binh Chieu industrial district, which is roughly 60 minutes from the heart of Ho Chi Minh City. This position makes it difficult to provide products to branches quickly, especially during peak hours or urgent cases, which significantly increases transportation costs. The gap needed to fill Currently, increased demand for bird's nests leads to heated competition among bird's nest producing enterprises, necessitating higher awareness and market development.
However, the warehouse in the Binh Chieu industrial park is currently fairly remote from the city center. As a result, this study is being undertaken to offer an alternative warehouse 5 location with optimal routes to cut transportation costs while still meeting the need of branches in South Vietnam. Objectives NutriNest is facing a significant challenge in optimizing its warehouse location to reduce total transportation costs and enhance the delivery process. The scale of this problem is substantial, as it affects the entire supply chain and distribution network of NutriNest products.
This endeavor aims to minimize transportation expenses, improve delivery efficiency, and enhance overall supply chain performance. By achieving these objectives, NutriNest aims to increase profitability, customer satisfaction, and its competitive edge in the health and nutrition industry. Scope and limitation 1. Scope and assumption The scope of this project encompasses several key dimensions.
Evaluation of the size of the NutriNest operation, including the volume of products and materials to be handled in the warehouse and transported. Assessment of the scale of operations, considering the number of warehouses, distribution centers, and the extent of the distribution network. This project primarily centers around improving NutriNest's warehouse operations. It involves using a mathematical model to evaluate four potential new locations for the old warehouse.
The evaluation considers various factors like delivery time, operational expenses, shipping costs, and staffing, ultimately helping to rank and assess the available options. Limitation 6 The relocation and optimization of NutriNest Factory's warehouse face several constraints that could significantly impact the planning and execution of these strategic initiatives. These limitations encompass a range of factors, each posing unique challenges to the seamless implementation of relocation and optimization efforts. Firstly, budget constraints emerge as a substantial impediment.
Financial limitations may curtail the extent to which NutriNest can execute the relocation and optimization plans. This could restrict the scope of improvements and innovations, potentially hindering the overall effectiveness of the project. Secondly, geographical constraints add another layer of complexity. The availability of suitable warehouse locations is contingent on various factors such as zoning regulations and proximity to suppliers and customers.
These geographical considerations may limit the options available to NutriNest, making it imperative to navigate these constraints with strategic acumen. Thirdly, time constraints loom large over the initiative. Operational demands and deadlines impose limitations on the time available for a comprehensive analysis of potential locations and the subsequent implementation of relocation and optimization strategies. The pressure to meet deadlines may impact the thoroughness of the planning process.
Fourthly, external market dynamics introduce a layer of uncertainty. Changes in market demand or shifts in competition dynamics may influence the effectiveness of the chosen strategies. NutriNest must remain agile in responding to these external factors to ensure the continued relevance and success of the relocation and optimization efforts. Fifthly, the availability of resources poses a critical limitation.
The success of the project relies on skilled personnel, technology resources, and expertise in supply chain 7 management. A scarcity of these essential resources may impede the smooth execution and realization of the intended benefits. Lastly, environmental regulations present a unique set of challenges. Compliance with environmental standards and the incorporation of sustainable transportation options may be imperative for NutriNest's environmental objectives.
However, these regulations could pose limitations on the project, necessitating careful navigation to align with both operational and environmental goals. Project plan Chapter Tasks Start End Duration Motivation Week 3 Week 4 1 week Problem statement Week 3 Week 4 1 week Objectives Week 3 Week 4 1 week Scope Week 3 Week 4 1 week Introduction Limitation Week 3 Week 4 1 week Gantt chart Week 3 Week 4 1 week Overview Week 5 Week 6 1 weak 8 Current system Week 5 Week 7 2 weeks investigation Design concepts Literature review Week 6 Week 7 1 week consideration Considered Week 6 Week 7 1 week solution direction Approaches Week 7 Week 8 1 week comparison and selection System design System design Week 8 Week 9 1 week description Analytic hierarchy Week 9 Week 11 2 weeks process (AHP) Vehicle routing Week 12 Week 15 2 weeks problem (VRP) Prototype Sensitivity Week 15 Week 17 2 weeks development and analysis implementation Analyze the Week 13 Week 15 2 weeks environmental, social, and 9 economic impacts Summary Week 16 Week 17 1 week Conclusion Recommendation Week 17 Week 18 1 week Table 1-1: Project plan 10 CHAPTER 2: METHODOLOGY 2. Overview The subject of this study pertains to NutriNest Nutrition Food Joint Stock Company, which specializes in offering a diverse array of products associated with salanganes nest, meticulously crafted to augment the quality of life through nourishment and convenience. At present, NutriNest operates five exclusive stores and a warehouse in Ho Chi Minh City, namely: Store 1 & 2: Situated in the Phu Nhuan District.
Store 3: Positioned in District 10. Store 4: Found in Tan Binh District. Store 5: Located in Tan Phu District. Warehouse: Located in Binh Chieu Industrial area, Thu Duc District.
The primary focal demographic of NutriNest encompasses business proprietors and individuals spanning all age groups, ranging from infants to the elderly. Apart from the salanganes nest beverages, NutriNest also features an assortment of instant porridge products, thereby broadening the spectrum of its target consumer base. 11 Figure 2-1: Distance between the current warehouse and five stores 2. Current system investigation: 2.
Detailed current system: 2. Investigate the current system: The extant framework governing NutriNest's supply chain, encompassing the process from product importation to final-mile delivery, comprises two key departments, namely the Supply Chain Management team and the Operations team: ● The Supply Chain Management team: This unit is responsible for overseeing the intricate importation process. Their duties entail meticulously monitoring incoming 12 shipments and effectively managing the inventory upon its arrival at the designated warehouse. ● The Operations team: Tasked with the management of product handling and the ultimate stage of delivery.
Within this team, a designated team leader assumes the responsibility of strategizing and coordinating the operational activities executed by the team members. Figure 2-2: NutriNest’s current system 2. The delivery procedure: The responsibility of product delivery lies with the Operations team, and it involves the following stages: 13 1. Verification and approval of incoming orders: The team meticulously scrutinizes the incoming mails in the Outlook system, assessing the validity and necessity of new orders before deciding whether to authorize them for further processing.
Verification and printing of sales slips: This step involves a thorough inspection of sales slips, ensuring their accuracy and completeness, followed by their printing for inclusion in the delivery packages. Inventory assessment and order preparation: The team conducts a comprehensive evaluation of the existing inventory, preparing the necessary items for packaging and subsequent delivery. Inspection and repackaging of items: Post-assessment of the product condition, the team undertakes the crucial task of repackaging the products with secure packaging, affixing 'Fragile' stickers on the outer packaging to highlight the delicate nature of the enclosed items. The final step involves consolidating the items within each order.
Delivery: Upon the departure of the delivery vehicle, the Sales/Admin team promptly contacts the client, apprising them of the ongoing delivery process, along with the anticipated time of arrival. In case of any delivery-related issues during transit, immediate communication is initiated with the client, while simultaneously involving the management personnel to expedite resolution procedures.