How They Work
Optimization is based upon setting costs to the supply chain, and then letting the optimization routine make decisions. In other parts of SCM, such as SNP and PP/DS, this means applying many costs, and then updating these many costs. However, TP/VS tends to have fewer different types of costs..and fewer to maintain as well. Secondly because their are fewer stakeholders in transportation, it is easier to agree upon what the costs are. Transportation costs are explicitly – if a company has outsourced its transportation. For companies with private fleets, its a bit more tricky. Delivery window costs to partners are explicit, but implicit for stock transfers to a company’s own facilities.
Where They Are Setup
TP/VS Costs are setup in the maintain vehicle scheduling costs configuration transaction.
You are then taken to a multi-tabbed interface that offers many different types of costs to setup.
Load costs are one set of costs.
Shipment costs are the easiest to agree upon.
The costs related to penalties are also entered.
