DyStar Supply Chain Analysis

This assignment analyzes DyStar's supply chain, focusing on the integration of logistics with production, marketing, and finance. It examines current order processing and inventory management systems, recommending enhancements through information technology and agile methodologies. The analysis incorporates theoretical frameworks and empirical research to provide a comprehensive understanding of DyStar's supply chain challenges and opportunities.

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Principles of Logistics Management

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Table of Contents
Introduction................................................................................................................. 3
Background and Purpose of the Report..................................................................3
Overview of DyStar Group.......................................................................................3
The Interfaces............................................................................................................. 4
Interface between Logistics and Production............................................................4
Interface between Logistics and Marketing.............................................................5
Interface between Logistics and Accounts and Finance..........................................6
Order Cycle.................................................................................................................6
Inventory Management............................................................................................... 8
Conclusion.................................................................................................................. 9
References................................................................................................................10

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Introduction
Background and Purpose of the Report
The purpose of the report is to analyze the current operations of a manufacturing
company in terms of linking the same with logistics functions. It focuses on analyzing
the interfaces between logistics functions with the production, marketing and
accounts and finance activities of the manufacturing firm. Further, effective analysis
and recommendations are taken to be rendered associated with the order cycle and
the inventory management functions of the manufacturing organization. Both
empirical and case study related research is taken to be undertaken for
understanding and evaluating the effectiveness and potential of the logistics
functions of the manufacturing firm with order cycle and inventory management
activities conducted by it. The report would thus help in reflecting on the practical
effectiveness of the theoretical directions concerning logistics management activities
regarding manufacturing organizations.
Overview of DyStar Group
DyStar Group established during 1995 in terms of a joint venture between two
companies Hoechst AG and Bayer Textile Dyes operates as a market leader in
manufacturing dyestuff and chemicals and also in generation of coloring solutions.
DyStar Group serves its customers through the generation of different types of
colorants, effective chemicals and also other types of services. A timeline of DyStar
Group is reflected as follows.

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(DyStar Singapore Pte Ltd, 2017)
DyStar Group renders innovative services and solutions to the textile industry while
also providing services to other sectors like paints, packaging industry, coatings and
also paper products. It also serves other sectors like food and beverage and also
personal care through the generation of different types of chemical solutions and
products. The service divisions of DyStar Group essentially focus on providing
assistance to different types of brands, retail institutions and also other types of
industry partners in terms of operating through effective supply chains that helps
both in reducing lead times and also the supply chain and distribution costs.
Moreover, DyStar also works based on the basis of an econfidence program that
generates assurance regarding the meeting of legal compliances of its chemical
products and solutions (DyStar Singapore Pte Ltd, 2017).
The Interfaces
Interface between Logistics and Production
An effective interface between logistics and production is associated to the duration
required for meeting of the production operations. Operational efficiency is
determined in terms of existence of long range production runs with infrequent
amount of changeovers. However, production operations carried out for longer

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durations tend to result in some finished products while also limits the supplies of
other types of merchandises (Rushton, Croucher, & Baker, 2017). Production
managers are thus required to evaluate the benefits and challenges associated to
both long and short term production activities and the impact of such on the
inventory position of the firm. Manufacturing or production firms are observed to
focus on the development of short-term production functions and essentially focus on
reducing the cost and time associated to shifting of production activities from one
product line to another (Coyle, Langley, Novack, & Gibson, 2012).
Optimization of logistics in DyStar contributes in reducing the amount of space
required for transportation of cargo from one region to another. The same helps in
reducing wastage of cargo space while also generate fuel efficiency and reduction of
transportation costs. Production sites are planned in areas with proximity to potential
customer bases. The optimization of the logistics space enabled by trucks
contributes in generating needed efficiency. Development of satellite warehouses at
different regions and provision of consignment stocks to potential buyers are
identified as two activities for enhancing productivity of land transportation systems.
For long distances, DyStar focuses on sea freight logistic systems compared to air
freight owing to increased cost of the latter (DyStar Group , 2016).
Interface between Logistics and Marketing
The logistics function of an organization bears effective relation with the marketing
activities of the firm in that the outbound systems or development of distribution
networks plays a key aspect in selling of a product. The interface between marketing
and logistics function can be further studied based on the incorporation of 4Ps like
product, price, place and promotional elements of the marketing mix.
Regarding product, the logistics department is concerned with the different
dimensions like size, shape, volume and weight of the product in that effective
packaging is required to be provided thereof. Knowledge about the above
dimensions also helps in generation of effective storage of such products and also in
estimating use of logistics space (Christopher & Peck, 2012).

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In terms of pricing delivery of large quantities of products enables the shipper to save
costs regarding logistics operation. Saving on logistics costs thus helps the marketer
or producer to render discounts and rebates to the ultimate customer.
The place parameter focuses on evaluating the type of distribution network favored
by the firm. Distribution networks that are wholesale bounded are observed to reflect
reduced amount of logistics compared to that of retailers needing frequent use of
logistics (Min, 2015).
Relating to promotional aspects it is the duty of the marketer generating promotions
or sales to rightly collaborate with the logistics team for generation of the right
amount of products ordered by the customers within the stipulated period.
In DyStar land based distribution functions are aptly catered based on truck based
transports such that the same helps in reaching merchandises to customers in a cost
effective fashion. For long distances, logistics system enabled based on sea
transport are favored compared to air transport systems for reducing costs (DyStar
Group , 2016).
Interface between Logistics and Accounts and Finance
Apart from production and marketing, logistics also bears an effective relation with
the accounts and finance department of a business institution. Logistics functions
tend to potentially affect the Return on Assets (ROA) or the Return on Investments
(ROI) of a firm. Accumulation of unused inventory levels negatively affects the ROA
of the company and vice-versa. Again, increase in the level of costs regarding
transportation and warehousing also tend to affect the ROI levels of the organization.
Similarly, the accounts and finance department also focus on evaluating the amount
of returns gained based on the investments rendered regarding development of
logistics functions (Kasilingam, 2012).
In DyStar the management focuses on generation of full loads of transport such that
the same helps in optimization of space and thereby in reducing costs associated
with fuel and logistics space (DyStar Group , 2016).

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Order Cycle
The order cycle of DyStar reflects that the offers rendered by the seller are not
binding based on different parameters like price of the merchandises, quantity to be
delivered, time at which the delivery is required to be carried out and finally the
availability of the product. On the contrary, the offer put forward by the buyer
requires to be implemented by the seller in that it stands binding on the latter owing
to the buyer’s acceptance of the invoice generated by the seller. The seller is thereby
required to put into effect the delivery as quickly as possible. The seller is thereby
not required to fix different times of delivery. However, in cases where an agreement
regarding time of delivery is agreed between the buyer and seller, the latter is
required to incorporate the actions of the suppliers for delivering the right amount
and pattern of products to the buyers. The delivery is required to be carried out in a
punctual fashion such that the delivery date is ascertained as the specific date at
which the merchandises have reached the buyers. The seller has the right for
selecting both the route and also the transport mode for delivering the products to
the customer. The cost required to be incurred for meeting of special delivery is
required to be borne by the buyer on account of the demand made by the latter
(DyStar , 2014). The order processing system of a manufacturing firm is reflected as
follows.
(Kuljanic, 2014)

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In terms of packaging, DyStar focuses on the generation of recycled and reused
packaging such that the same can be used in a repetitive fashion along future
periods (DyStar , 2012).
The responsiveness of the Order Processing System of DyStar can be effectively
enhanced through the incorporation of information technology. The IT enabled order
processing system contributes in effective tracking of the merchandise’s location,
movement of the merchandise along different locations and also the credit standing
of the customer. The computer instantly contributes in the generation of the shipment
order, bills for the customers, updating inventory records, helps in replenishment of
stocks and also intimates the sales representative regarding the actual situation of
the order. Incorporation of Information Technology ideally contributes in speeding up
the order processing system and also enhances the effectiveness of the system
leading to reduction of discrepancies (Venkataraman & Pinto, 2017).
Inventory Management
DyStar operating as a manufacturing company in the ambit of chemical industry is
required to handle large amounts of inventory for meeting the diverse needs of its
customers and other stakeholder groups. The firm focuses on optimizing on its
inventory volumes for enhancing the revenue and return generation capacity on the
investments made concerning the carrying out of the production functions. DyStar
depending on the production and delivery of products that are affected by price
volatility is observed to suffer from the unpredictable nature of the inventory
amounts. Standardization of the inventory levels for DyStar stands as a prerequisite
in cases where the company is required to focus on the development of stock
keeping function for meeting of key needs of local and regional markets. Further,
effective inventory volumes are required to be rightly planned for meeting of
contingencies such that the same is integrated with logistics, sales and procurement
activities. Planning of effective inventory volumes rightly help in managing
shutdowns of supplier units and also changes in consumer demands (Kirschstein,
2015).

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DyStar can effectively focus on working based on real time inventory tracking
mechanisms such that it needs to incorporate agile breakthroughs based on the
incorporation of Radio Frequency Identification or RFID Bar Codes for its products
and also Point-of-Sales scanners across sales outlets, warehouses and supplier
stations. The incorporation of POS Scanners would help in ideally tracking the
movement of merchandises along the different centres such that the same would
help in enhancing the effectiveness of inventory tracking while also in evaluating the
changes in consumer behavior and demands. Data collected through the use of POS
Scanners is transmitted over the ERP Software for helping the different stakeholders
gain effective access to such data for inventory/stock planning and management
purposes. Effective stocking of needed inventory can be planned through the
synchronization of logistics and transportation mechanisms for reaching of stocks to
the manufacturing units on time for meeting the objectives of Just-in-Time (JIT)
mechanism (Stern, 2017).
Conclusion
The report effectively analyses the different interfaces that were generated between
the logistics functions carried out by DyStar, a dye and product manufacturing
company with its production, marketing and finance and accounts functions. The
case study of DyStar is analyzed based on the incorporation of empirical research
associated to the study of books, reports and other potential literature. Further, the
current order processing and inventory management system of DyStar is also
analyzed in the report based on the incorporation of theoretical inputs. The current
order cycle of DyStar is recommended to be enhanced through the incorporation of
Information Technology tools while the inventory management systems of the
company are taken to be enhanced based on the generation of needed agility.

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References
Christopher, M., & Peck, H. (2012). Marketing Logistics. New York : Routledge .
Coyle, J. J., Langley, C. J., Novack, R. A., & Gibson, B. (2012). Supply Chain
Management: A Logistics Perspective. United States : Cengage Learning.
DyStar . (2014). General Conditions of Sale and Delivery. Retrieved October 1,
2017, from
https://www.dystar.com/wp-content/uploads/2015/06/GeneralConditionsofSale
.pdf
DyStar . (2012). Sustainability Report . Singapore: DyStar.
DyStar Group . (2016). Sustainability Performance Report. Singapore : DyStar
Group .
DyStar Singapore Pte Ltd. (2017). About DyStar Group. Retrieved September 30,
2017, from https://www.dystar.com/about-dystar-group/
Kasilingam, R. G. (2012). Logistics and Transportation: Design and planning. United
Kingdom : Springer.
Kirschstein, T. (2015). Integrated Supply Chain Planning in Chemical Industry:
Potentials of Simulation in Network Planning. United Kingdom : Springer.
Kuljanic, E. (2014). AMST'99 - Advanced Manufacturing Systems and Technology:
Proceedings of the Fifth International Conference. United Kingdom : Springer.
Min, H. (2015). The Essentials of Supply Chain Management: New Business
Concepts and Applications. United States : FT Press.
Rushton, A., Croucher, P., & Baker, P. (2017). The Handbook of Logistics and
Distribution Management: Understanding the Supply Chain. United States :
Kogan Page Publishers.
Stern, T. V. (2017). Lean and Agile Project Management: How to Make Any Project
Better, Faster, and More Cost Effective. United Kingdom : CRC PrEss.

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Venkataraman, R. R., & Pinto, J. K. (2017). Operations Management: Managing
Global Supply Chains. United Kingdom : SAGE.