Network Design in the Supply Chain

5 important questions on Network Design in the Supply Chain

What is a free trade zone?

zones in which duties and tariffs are relaxed as long as production is used primarily for export, mostly located in developing countries.

What is meant with positive externalities between firms?

these occur when the collocation of multiple firms benefits all of them. Lead to competitors locating close to each other. If there are none firms will locate to split the market.

Give the 4 phases made in global network design decisions

  1. Define a supply chain strategy
  2. Define the regional facility configuration
  3. Select a set of desirable potential sites
  4. Location choices
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What is the difference between Hard and Soft infrastructure requirements?

Hard infrastructure requirements are for example availability of suppliers, transportation services, communication, utilities and warehousing facilities.
Soft infrastructure requirements are for example availability of a skilled workforce, workforce turnover and community receptivity to business and industry.

Give 4 the 4 issues you have to take into mind when making network design decisions for a supply chain

  1. Do not underestimate the life span of facilities
  2. Do not gloss over cultural implications
  3. Do not ignore quality-of-life issues
  4. Focus on tariffs and tax incentives when locating facilities

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