Using RFID to Create Digital Tobacco Logistics

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On December 25, 2006, Chongqing Tobacco Wanzhou Distribution Center officially started operation. This means that Chongqing’s 110,000 cigarette retail customers have all been included in the service system of “telephone ordering, online distribution, electronic settlement, and modern logistics”. So far, Chongqing Tobacco’s modern logistics system has begun to take shape, and heavy tobacco logistics is step by step——

Looking back on the path taken by Chongqing Tobacco Logistics——

In June 2005, the blueprint for Chongqing cigarette logistics construction began to be drawn, and the Chongqing tobacco logistics construction plan was initially determined;

In August 2005, the Jiangbei Distribution Center project completed the demonstration and project approval;

In October 2005, Jiangbei Distribution Center broke ground;

In April 2006, Chongqing Tobacco Logistics Company was formally established;

In June 2006, the Jiangbei Distribution Center was put into operation and began to implement centralized telephone ordering and unified distribution of 58,000 cigarette retail customers in the main city and 21 counties (districts) in western Chongqing;

In August 2006, the reconstruction projects of the distribution centers in Fengdu, Qianjiang, and Fuling and the new construction of the distribution centers in Wanzhou started one after another;

In October 2006, the three distribution centers of Fengdu, Qianjiang and Fuling were launched simultaneously, and nearly 30,000 cigarette retail customers were included in the centralized telephone ordering and unified distribution system;

In December 2006, the Wanzhou Distribution Center officially opened, marking the start of Chongqing Tobacco’s “one warehouse and four points” logistics distribution model. The city’s 110,000 cigarette retail customers will receive standardized, high-quality, and unified logistics services, and the logistics and distribution of cigarettes in Chongqing has successfully achieved the “unification”.

Through these “footprints”, we can clearly see the development of Chongqing tobacco logistics and feel its progress. From 2005 to 2007, from the “separation of princes” to the “universal unification” of the city, every step of the construction of Chongqing Tobacco Logistics was so sonorous and powerful. A “high-quality, high-efficiency, low-cost” heavy-tobacco integrated “big logistics” picture is gradually unfolding before our eyes…

Plan carefully to reduce logistics costs

The design of the logistics center construction plan is related to the optimization degree of the distribution route and the operation effect of the entire logistics system after the completion of the entire logistics system. It is a key link to ensure that the logistics construction can achieve the goal of “low cost and high efficiency”. For this reason, Chongqing Tobacco has made great efforts in the overall planning of the logistics center.

“In infrastructure construction, we make full use of idle warehouses and idle land, reduce land acquisition investment, and reduce investment in new construction; the location of the sub-library makes full use of the advantages of being adjacent to the local tobacco factory to reduce transportation costs; in the selection of equipment, We are not greedy for foreigners, and fully consider the connection between early investment and later maintenance, and choose economical and technically mature electronic label auxiliary sorting equipment; in information construction, we focus on the combination of management and existing information systems, and fully Take advantage of the large concentration of equipment to avoid duplication of investment.” Said Xiang Shitao, manager of the logistics branch of Chongqing Tobacco Company, Chongqing Tobacco Logistics adopts the construction model of “flat warehouse storage + electronic label sorting” with “one warehouse and four points”. The use of “high-rack storage + automated sorting” on the same scale reduced investment by nearly 100 million yuan, and achieved the lowest investment cost (excluding land requisition fees) for a single box of logistics construction.

The use of professional management to reduce operating costs is a bright spot in the construction of heavy tobacco logistics. The “one warehouse and four points” logistics model realizes centralized storage, centralized sorting, and centralized/graded delivery, which not only reduces labor and labor by 1/3, but also greatly reduces the time from order acquisition to delivery to the household, accelerating Improve the speed of goods turnover, reduce the occupation of inventory funds and inventory maintenance costs.

It is understood that the operation of the “one warehouse and four points” logistics model has saved Chongqing tobacco by more than 50 million yuan, and the city’s financial, management, and operating expenses have been reduced by more than 90 million yuan.

Rolling work to improve operating efficiency

In order to achieve the optimal allocation of resources, maximize resource utilization, and maximize efficiency, Chongqing Tobacco proposes a “rolling operation” model, that is, order collection and payment settlement are performed simultaneously, order collection and sorting and distribution are rolling operations, and the platform is unified and the seats are scattered and random. Combine.

——Change the batch payment after the order collection is completed, and change the order collection and payment settlement to be performed simultaneously. They plan the call area from farthest to the nearest to ensure that the order collection in the call area is completed within 30 minutes, and the review of the batch of order settlements is completed within 20 minutes. In this way, electronic settlement can be completed while continuously obtaining orders.

——After all payments are settled, they are packaged and sent to the distribution center for sorting and distribution, instead of collecting orders and sorting and distributing simultaneously. At the same time of real-time electronic settlement, they deliver the orders of each call area to the storage and distribution department in time, and the storage and distribution department starts sorting within an hour, reducing waiting time and ensuring that the sorting personnel can complete the order within 8 hours Operation.

—— The order calling organization and the sorting and distribution organization are set up one-to-one, instead of matching and random combination of the calling and distribution organization. When a certain order department (or distribution department) cannot call (or deliver) for some reason, the nearest order department (or distribution department) is adopted to work on its behalf, which not only guarantees the efficiency of logistics operation, but also avoids temporary interruption of some nodes risks of.

Over the past two years, heavy tobacco logistics personnel have built a “low-cost, high-efficiency, and digital” company based on their hardworking spirit to challenge the limit, the innovative spirit to be the first, the team spirit of concerted efforts, and the dedication regardless of gains and losses. Chongqing’s cigarette logistics system has laid a solid foundation for building a modern “big logistics” that is economical and applicable, a unified platform, and a first-class level.

The picture shows the exterior view of Chongqing Tobacco Logistics Center.Correspondent Photo by Zou Yi

In 2006, the Chongqing Tobacco Logistics Information System achieved the “digital Chongqing Tobacco” goal of “system integration, resource integration, and information sharing”, which raised the level of application of Chongqing Tobacco’s information technology to a new level, and contributed to the efficient operation of the city’s logistics work. Provides technical guarantee.

The use of modern technology to increase the flow rate in the warehouse is an important measure of Chongqing Tobacco in the process of creating “digital Chongqing tobacco”. Through the system integration of logistics technology and information technology, they use storage management ideas, radio frequency identification technology (RFID), handheld computers, wireless electronic tags and other equipment to enable cigarette goods to enter and exit and move in the warehouse quickly and accurately. At the same time, according to the generalized warehouse management idea, they realized the unified management of the storage area and the sorting area, so that the operation of business flow, logistics, and capital flow achieved the effect of accurate data and rapid transmission.

Digitization is the support and management is the guarantee. In order to achieve the logistics goal of “low cost, high efficiency, and digitalization”, in 2007, Chongqing Tobacco took standardization construction as the starting point, and vigorously promoted logistics through the unification of resources allocation, operation operation, labor employment, operation scheduling and other standards. Refinement of management.

——Further refinement of logistics financial management. Through innovative logistics cost control and accounting systems, Chongqing Tobacco has further strengthened its overall management of logistics finance. They have established a series of detailed implementation rules for logistics cost management and control, which completely separates logistics cost accounting from sales cost accounting. At the same time, they have also established a logistics cost database to classify and list logistics costs in detail, and implement cost quota control, target control, and standard control. In addition, they take operation cost as the logistics cost control objective, implement hierarchical and centralized management of costs, allocate the cost of each operation to the smallest responsible unit of the operation department, and implement the cost and cost assessment of the operation unit, forming a logistics cost before, during, and after. Financial management system for effective control afterwards.

——The system construction is more standardized. Since its establishment, the logistics branch of Chongqing Tobacco Company has followed the modern corporate management concept of “acting by system and managing people by system”, and has paid close attention to system construction, timely formulation and continuous improvement covering corporate management, personnel and labor, financial audit, sorting and distribution , Information network, party style, clean government, safety and security, etc., to form a more scientific and complete management system. As of December 2007, Chongqing Tobacco Logistics Branch has established and revised 84 management systems. In the assessment rules of the logistics branch, the indicators issued by the municipal bureau (company) have been effectively decomposed. The branch and each department sign the target responsibility letter, in accordance with the principle of combining total quantity and qualitative, combining main indicators and comprehensive indicators, and combining economic indicators and non-economic indicators, and inspecting and assessing the implementation of the system according to the target responsibility letter. , In order to promote the efficient operation of various logistics tasks.

At present, the various operations of Chongqing Tobacco Logistics Branch have achieved an 8-hour work system 5 days a week, one shift a day, the sorting line sorting and packaging comprehensive operation reached more than 180 pieces/hour, and the vehicle loading rate reached more than 95%. Satisfaction with complaint handling reached 100%.

For more than two years, the people of Chongyan Logistics have built a “low-cost, high-efficiency, and digital” company based on their hardworking spirit to challenge the limit, innovative spirit to be the first, team spirit of concerted efforts, and dedication regardless of gains and losses. Chongqing Tobacco Logistics has strongly promoted the transformation from traditional commerce to modern circulation.

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