Logistics Network Analysis of TESCO, ALDI and LIDL

Logistics and operation
management

Table of Contents
INTRODUCTION...........................................................................................................................3
LO1..................................................................................................................................................3
Analysis of Logistics networks of TESCO, ALDI and LIDL.....................................................3
LO2..................................................................................................................................................5
Alignment between Company's strategic plan and its logistics network operations...................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Logistic network analysis deals primarily with transportation and is used to analyse the
strengths and weaknesses of different transportation modes. Logistics network analysis identifies
and studies various production volumes, supply sources , inventory levels etc. for all
organisation's sites in reference to the network limitations present. It also generates a
transportation plan with the singular objective of identifying most efficient and cost effective
transportation modes for particular segments of network (Murphy and Knemeyer, 2018). In this
report we study the logistics network of three companies, evaluate their advantages and
disadvantages and study how company's business plan aligns along with its distribution and
logistics operations. The three companies we evaluate are all retail supermarkets operating in
UK- TESCO, ALDI and LIDL.
LO1
Analysis of Logistics networks of TESCO, ALDI and LIDL
Logistic Network Analysis of TESCO: Up until 1970, TESCO used to operate using Direct to
Store Delivery (DSD) logistic model, under which suppliers and manufacturers could choose the
location of store to which they wanted to make delivery. After that TESCO opted to implement a
centralised system in place of DSD for logistic operations. Tesco has also implemented a
Continuous Replenishment policy in 1999 which allows suppliers to make deliveries multiple
times and provides TESCO with a flow system. In addition to this, TESCO's administration also
has developed a logistics strategy which adheres to most industry standards for planning and
implementing a proper logistic network.
Advantages provided by TESCO's logistics network are numerous, its operational change
from an aged Direct to Store Delivery (DSD) to a better centralised systematic model was done
in order to have provide TESCO with better control over their prices of goods, services and
maintain required product quality throughout its various stores. Implementation of Continuous
Replenishment policy at TESCO, allowed manufactures and producers to make multiple
deliveries to various stores either from warehouses, depots or manufacturing plants (Christopher,
2016). This allows TESCO to sell even greater numbers of products without running out of
inventory of stored goods and products.