Research On The Improvement Of Controlling Tianrun Chemistry Company's Logistics Cost

Since 21st century, global economic competition is becoming increasingly fierce and globalization faster and faster. Traditional management models are confronted with serious challenges. There is hardly any room for the reduction of logistic cost. Rationalizing logistic cost in enterprises is not only an important method to reduce cost and improve economic performance, but also a significant way to optimize enterprise's management systems and maintain competiveness. This article analyzes Tianrun Chemical Company's shortcomings basing on actual situations in the control of logistic cost at three levels-overall level, organization level and implementation level, and puts up with improvement solutions hoping to reduce the logistic cost and improving company's economic profits.Tianrun Chemical Company is a manufacturing company whose products are mainly Urea, ammonium acid carbonate, liquid ammonia and crude alcohol. These products have been sold to Hubei and Hunan, Guangdong and Guangxi, Jiangxi, Henan and other large areas and hold huge market shares. There are still many problems to be solved in logistic cost control. By several times of field research in Tianrun Chemical Company and studying financial model of logistics cost, theory of logistics system cost control and logistics cost control measures, this article analyzes Tianrun Chemical Company's problems at three levels-overall level, organization level and implementation level. Firstly, awareness of logistic cost is lack in company and the strategic control system of logistic cost is still not yet constructed. Secondly, decentralized administration authority and unreasonable accounting of logistic cost in financial center is another problem faced by this company. Third, management of supplier is insufficient; storage is also not used efficiently with high cost; sales plan is still in blank; the recycling rate of reverse logistic waste is low.Finally, according to the realistic situation of chemical industry and this company, this article comes up with improvement solutions to control logistic cost in all aspects: first, raising awareness among management layer, motivating all workers to participate in the control of logistic cost control more actively and building a appraisal mechanism of logistic control; second, constructing a logistic cost control center and using activity-based costing method in the accounting of logistic cost; third, applying centralized management in suppliers, choosing suppliers properly and giving encouragement timely; setting temporarily storages in order to improve storage capacity and reduce storage cost; enhancing field research and information feedbacks to understand clients'need promptly; outsource reverse logistic costs to a third party, namely a logistic supplier and cooperating with environment department actively to cut down reverse logistic cost.