INSTITUTO SUPERIOR Universidade Simulating a Distribution Chain João Granado Marques Dissertation for the Degree of Master of Civil Engineering Examination Committee Chairperson: Prof. Joao Torres de Quinhones Levy Supervisor: Prof. Amílcar José Martins Arantes Member of the Committee: Profª Cristina Marta Castilho Pereira Santos Gomes November 2013 ii Acknowledgments I would like to thank my coordinator, Professor Amílcar Arantes for the help and support during the writing of this dissertation. I would also like to thank my family, Mr. S and Hanz for their support. iii iv Abstract Nowadays, distribution operations play a central role in the performance of any organization, ensuring a significant and decisive impact on the quality of the service provided to the end user. The aim of this dissertation is to contribute to the enhancement of distribution operations in a retail company through the development of a simulation model, using Simul8, a discrete event- based simulation software. On the one hand, the results confirm the utility of simulation methodology in solving real problems, random by nature. On the other hand, they make it possible to outline valuable guidelines on the way the study company ought to implement its distribution operation. Keywords Logistics, distribution, simulation, supply chain, discrete event based simulation. v As operações de distribuição assumem nos dias de hoje um papel fundamental no desempenhoSumário das empresas, com impacto significativo em termos de nível de serviço ao cliente final. O objetivo do presente trabalho é o de contribuir para a melhoria das operações de distribuição de uma empresa de venda a retalho através do desenvolvimento de um modelo de simulação, utilizando Simul8, um software de simulação por eventos discretos. Os resultados, por um lado confirmam a utilidade da metodologia de simulação na resolução de problemas reais, aleatórios por natureza, e, por outro lado, permitem traçar orientações valiosas sobre a forma como a empresa em estudo deve implementar a sua operação de distribuição. Palavras chave Logística, distribuição, simulação, cadeia de distribuição, simulação baseada em eventos discretos. vi Content Acknowledgments ......................................................................................................................... iii Abstract ......................................................................................................................................... v Keywords ....................................................................................................................................... v Sumário ......................................................................................................................................... vi Palavras chave .............................................................................................................................. vi Index of Figures ............................................................................................................................. ix Index of Tables .............................................................................................................................. xi 1. Introduction............................................................................................................................. 1 1.1. Context .......................................................................................................................... 1 1.2. Objectives ...................................................................................................................... 2 1.3. Methodology .................................................................................................................. 2 1.4. Work development......................................................................................................... 3 2. Literature review ..................................................................................................................... 5 2.1. Logistics ......................................................................................................................... 5 2.2. Simulation ...................................................................................................................... 6 3. The original model .................................................................................................................. 9 3.1. Description ..................................................................................................................... 9 3.2. The original model in Simul8 ....................................................................................... 12 3.2.1. The distribution centre ......................................................................................... 13 3.2.2. The shops ............................................................................................................ 22 3.2.3. Validation, stabilization and run time ................................................................... 26 4. Improving the model ............................................................................................................. 29 4.1. Alternate routes ........................................................................................................... 29 4.2. Trucks that do not visit every shop .............................................................................. 36 4.2.1. Attempt 1 ............................................................................................................. 36 4.2.2. Attempt 2 ............................................................................................................. 39 4.2.3. Attempt 3 ............................................................................................................. 41 4.3. Validation of the final model ........................................................................................ 44 4.4. Stabilization of the final model ..................................................................................... 45 vii 4.5. Run time for the final model ........................................................................................ 46 4.6. Runs per trial ............................................................................................................... 47 5. Results and Discussion ........................................................................................................ 49 5.1. Original model and Final model both with five trucks .................................................. 49 5.2. Varying the number of trucks available ....................................................................... 50 5.3. Final discussion ........................................................................................................... 52 6. Conclusions and recommendations ..................................................................................... 53 Bibliography ................................................................................................................................. 55 Annex 1 – Simul8 – A discrete event-based simulation software ............................................... 57 Building blocks ......................................................................................................................... 57 Start Point............................................................................................................................. 58 Queue ................................................................................................................................... 60 Activity .................................................................................................................................. 62 End ....................................................................................................................................... 65 Resource .............................................................................................................................. 66 Simulation clock ....................................................................................................................... 68 Annex 2 – Tables ........................................................................................................................ 69 Warm up for the final model ..................................................................................................... 69 Run time for the final model ..................................................................................................... 69 Truck number for the final model ............................................................................................. 70 viii Figure 1 Carts filled with supermarket goods ................................................................................ 1 FigureIndex 2 Methodology of ................................ Figures.................................................................................... 2 Figure 3 Truck life cycle diagram ................................................................................................ 10 Figure 4 Truck route .................................................................................................................... 10 Figure 5 Cart life cycle diagram................................................................................................... 10 Figure 6 Activity cycle diagram ...................................................................................................