Rinchem's 4PL Logistics Solutions

The differences between a push model and a pull model in logistics

wHAT METHOD OF MATERIALS MANAGEMENT IS BEST FOR YOUR BUSINESS?

LOGISTICS SOLUTIONS

PUSH vs. pull model

9. Global Locations

8. Chem-Star

2. Benefits of TMM

1. Total Materials Management

7. Push vs. Pull Model

6. Pull Model Responsibilities

5. Pull Model Overview

4. Push Model Responsibilities

3. Push Model Overview

CONTENTS

(4PL Services)

total materials management

• Execution/coordination of warehousing & transportation activities
• Compliance to regulatory requirements
• Maintain product master

SUPPLIER

(Manufacturer)

FACTORY

Tactical Management of the Supply Line

Planning & Inventory Management

Freight Consolidation

Supply Chain

Chem-Star Reporting BI Reporting

Supply Chain Visibility

Elimination of Min/Max Excursion

TOTAL MATERIALS MANAGEMENT

+ TMM White Paper Case Study

• Elimination of multiple handoffs & third-party providers
• Weekly dedicated volumes to meet replenishment demands
• Global door-to-door management
• Cost visibility
• Cost avoidance
• Customized solutions department
• Track & trace
• Efficiency driven in the reverse logistics of the supply line
• Less overall risk in supply chain
• Ability to control the faucet into the warehouse

SERVICE FEATURES

BENEFITS OF RINCHEM 4PL LOGISTICSServices

Mitigate storage capacity issues -- Rinchem manages inventories. Ability to increase logistics buying power as opposed to the suppliers siloed approach.

Rinchem provides logistics reliability & reduction of the supply line risk.

CAPACITY

KEY DRIVERS

BENEFITS OF RINCHEM MANAGED LOGISTICS

push model

• Can result in excess inventory and waste
• Supplier controlled inventory

• Suitable for products with fluctuating demand

• Reduces restrictions on manufacturers ability to deliver material into the supply chain

LIMITATIONS:

BENEFITS:

The push model is a traditional approach to logistics, in which the supplier determines the delivery schedule and quantities of the products to be delivered. In this model, the supplier maintains an inventory of products in a central location and delivers them to the customer on a regular basis, regardless of whether the customer has placed an order or not. The push model is usually employed in situations where demand for the product is predictable and stable.

PUSH MODEL OVERVIEW

• Update buyer on Over max/expiration risk
• Work on inventory stability of DOI targets

• Update buyer on inventory risk
• Inventory management of customer-owned materials typically managed by RTMM
• Weekly forecast accuracy review to support DOI target
• Inventory balance change and overflow management

• Update RTMM and managed materials in risk/quality concern
• Forecasting plan

• Commitment and partnership
• Copy RTMM planner on each inventory
• Ship to desired min/max

RINCHEM'S RESPONSIBILITY

BUYER'S RESPONSIBILITY

SUPPLIER'S RESPONSIBILITY

PUSH MODEL RESPONSIBILITIES

pull model

• Less available inventory in supply chain
• Tighter restrictions on supplier production

• Best for products with consistent demand
• Can help reduce excess inventory and wasted product
• Reduces costs
• Improves sustainability

LIMITATIONS:

BENEFITS:

The pull model is a more recent approach to logistics, in which the customer determines the delivery schedule and quantities of the products to be delivered. In this model, the supplier does not maintain an inventory of products but instead waits for the customer to place an order before manufacturing and delivering the products.

PULL MODEL OVERVIEW

PULL MODEL RESPONSIBILITIES

• Update buyer on over max/expiration risk

• Provide re-order points and stocking levels for products
• Placing order quantity to suppliers
• Update buyer on inventory risks
• Inventory management of customer-owned materials typically managed by RTMM
• Weekly forecast accuracy review to support DOI target
• Material transfer request and overflow management
• Provide KPIs on supplier performance

• Update RTMM and managed materials in risk/quality concern
• Forecasting plan

• Commitment and partnership with open communication
• Provide lead time for each material
• Copy RTMM planner on each inventory

RINCHEM'S RESPONSIBILITY

BUYER'S RESPONSIBILITY

SUPPLIER'S RESPONSIBILITY

• System uses Min/Max and forecasted demand
• Manufacturer produces goods to anticipate customer needs & pushes them through the supply chain to retailers
• Manufacturer oversees maintaining stocking levels

• System runs uses actual consumption and reorder points to manage inventory.

• Manufacturers are responsible for having the material ready when the order is due.
• Direct management of total supply line.
• Fast pass into Rinchem docks for Rinchem managed shipments.

Current demand “pulls” the material; orders dictate when and how much inventory is needed.

Production dictates how much of the product will be "pushed" into the market.

vs.

PULL MODEL

PUSH MODEL

HOW THE PULL MODEL COULD BE A BETTER FIT

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Chem-Star® provides customers 24/7 real-time insight to all parts of their inventory where they can adjust hold statuses, use the Quick Shipper tool to rapidly place orders, and get live key performance metrics and analytics.

Meet Chem-Star®

Cloud-based warehouse management system

Executive Vice President20+ Years of Service at Rinchem

Chris Wright

“This is not simply a service our customers farm out to us. They are entrusting us with the life blood of their business; we take that responsibility quite seriously.”

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