Proceedings of ICLT 2012
EVALUATION OF THE DISTRIBUTION SYSTEM OF FERTILIZER STATE-OWNED COMPANY
Nahry Yusuf; Sutanto Soehodho; Triana Susanti
Department of Civil Engineering, Faculty of Engineering, Universitas Indonesia, Indonesia; Department of Civil Engineering, Faculty of Engineering, Universitas Indonesia, Indonesia; Department of Civil Engineering, Faculty of Engineering, Universitas Indonesia, Indonesia
International Conference on Logistics & Transport 2012, Chiang Mai, Thailand, pp. 20-27
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Abstract
Purpose: This paper is aimed to evaluate the distribution system of one of Indonesia Fertilizer Stateowned company which is obliged to apply specific distribution regulations dedicated for public service obligation of the company. Methodology: The distribution cost of the existing system is compared with the proposed ones through some scenarios of distribution to improve the system and a mixed integer programming is developed to represent the optimization problem of the proposed system. Findings: It is found that the proposed system could reduce the distribution cost by simplifying the distribution channelization and rearranging the clustering system of distribution warehouses while it keeps guarantee the security of supply. Practical Implications: The proposed system may help to diminish the delay problem on product delivery due to shorter distance and more simple channelization . Moreover, the reduction of the distribution cost may come to the reduction of the subsidy that should be provided by the government. Finally, this current research must be followed by detail analysis of the feasibility of the implementation of the proposed system, particularly of the social impact of the closure of the warehouses. Originality: The idea of public service obligation in distribution system becomes the originality of this paper and its value is to show that the government may increase the efficiency while the supply is kept secure at the same time.
Keywords
Distribution System; Public Service Obligation State-Owned Company Paper type: Case Study
Citation
Nahry Yusuf; Sutanto Soehodho; Triana Susanti (2012). EVALUATION OF THE DISTRIBUTION SYSTEM OF FERTILIZER STATE-OWNED COMPANY. Proceedings of the International Conference on Logistics & Transport (ICLT 2012), Chiang Mai, Thailand, pp. 20-27.