The Design And Implementation Of The Tobacco Logistics Cost Management System

Cost is a composite indicator to measure a company’s business management performance and improve its overall competition. To make a good cost management, optimize resource allocation and exploit the company’s potentials to the utmost extent is crucial for a company to win at low cost. The state authority issued the Regulations on Tobacco Logistic Costs Management and Calculation in2006to strengthen the system establishment and further standardize the logistic costs calculation in tobacco industry system.The establishment of tobacco logistic costs management system aims to reduce the expenditures arising from tobacco logistics including the process of storage, sorting, direct delivery and distribution, to further exploit a company potentials, to reduce expenditures and save logistic costs, to further improve the delivery efficiency and enhance the company’s service quality, to promote the marketing networking and speed up the modern establishment of distribution firms.Specifically, the significance of the cigarette logistic costs management in tobacco field resides in following three aspects:First, it grasps the total logistic costs of tobacco industry. By comparing among the entity’s own indicators and contrasting it with other entities within tobacco industry, it finds out the disadvantages and differences and analyzes the data of logistic costs so as to know the trend of tobacco logistic costs development.Second, it evaluates companies’ logistic business performance and grasps the logistic operation of the whole supply chain through making research on the data and analyzing the results.Third, it correctly assesses the functional departments’contribution to the whole logistic enterprises in order to provide the basis for planning the development strategy for enterprises.The essential requirement of building cigarette logistic costs management system is to improve enterprise’s operation efficiency and reduce its running costs, namely to supply the best service at the lowest cost. And the most important thing of logistic costs management is to realize the maximum economic benefit and reduce the expenditures and material consumption during logistic procedures such as storage, sorting and delivery. The decrease of enterprises’ logistic costs can make the function of logistic management more obvious and improve the competition of enterprises. It is just due to the nature of logistic management, the optimal decision of logistic enterprises’ operation strategy is to carry out the low-cost development, which concentrates all the logistic resources to satisfy customers’demand at low cost, so as to seize bigger share of the industry market.The paper aims to find out the key problems by analyzing the current situation of tobacco industry and contrasting it with the advanced management mode, set up the standard operating process and specifications for logistic operation and builds a system to budget and calculate logistic costs and assess performance by using information technology as quantitative description method. The major task of the paper covers four levels:the calculation of logistic costs in tobacco industry, the budget of logistic costs in tobacco industry, the performance evaluation of logistic costs in tobacco industry, and the management of logistic standards in tobacco industry. The system is estimated to rank top at home and will equip all crew with awareness of cost management so as to achieve the logistics establishment goals of effective control, high-efficient running and low-cost operation. Through the analysis and research of the requirements of present system of logistic costs management, it summarizes a centralized management mode that fulfills the requirements of cigarette storage, sorting and delivery in tobacco industry by combining with the latest Internet technology, and satisfies the integrated management system of tobacco logistics in virtue of Internet technology development.