ABC MODEL

Version 3.4a April 2003

STANDARD MODEL
zC uCC C vCC vBB uBB B uBA uAA vBA A vAA yFA x zA w zB zD b rEA rDA D yFD sCD sCE E yFE F yFC zE

c
dDE tED eDE eED

5 BASIC STOCKS

5 BASIC STOCKS
Plant Field (Q)
Conditioned Emitter Equipment Factory

Before Conditioning

Awaiting Inspection

Distributor

GENERIC CONVENTIONS

Uppercase = Stock Lowercase = flow

zS

S = change in stock S b = flow b zR = flow z from R bRS = flow b from R to S $$ = revenue $ = cost of the stock or flow $b = cost of flow b * = the cost of transport
blue = flow measurable by CHEP green = flow reported by customers orange = flow not reported to CHEP red = balancing flow (loss/gain)

f S

b R

e d

c zR

R = a b zR S = b + c d + e + f zS b = bR = bRS

When a flow has only one source and destination, the stock letters can be left off.

TOTAL POOL

Equipment Factory

new

Total Pool

scrapped

found

lost

SYMBOLS

STOCKS:
Total pool = T Equipment factory = F

FLOWS: New equipment = y Scrapped equipment = x Lost equipment = z Found equipment = w

T MODEL

y F

T = w x + y z

TOTAL POOL = PLANT + FIELD

yFP F
Sent (s)

P
Plant

Q
Field

yFQ

Returned (r)

x zP w

zQ

y = yFP + yFQ z = zP + zQ

PQ MODEL

yFP F s

yFQ

P
r

Q
y = yFP + yFQ z = zP + zQ T = w x + y z P = r s x + yFP + w zP Q = yFQ + s r zQ T = P + Q

x zP w

zQ

FIELD = EMITTER + DISTRIBUTOR

yFP
Emitter

yFQ

P
r

Distributor

x zP w

zQ

FIELD = EMITTER + DISTRIBUTOR

yFP E s F

yFQ

P
r

Q=D+E T=P+Q T=P+D+E T = P + D + E

x zP w

zQ

PLANT STOCKS

yFP
Conditioned

E s

yFQ

Before Conditioning

Q
r

Awaiting Inspection

x zP w

zQ

ABC MODEL

yFP C s E F

yFQ

Q
r

T=P+Q P=A+B+C Q=D+E T=A+B+C+D+E

x zP w

zQ

ISSUES, RETURNS AND TRANSFERS

zC yFP C sCE E yFE sCD dDE eDE eED F

zE

tED

rEA A rDA D yFD

x zA w

zB

zD

i = s + yFE + yFD + dDE

INTERPLANT FLOWS
zC yFP C u sCE E yFE sCD F

zE

a
B v

c
dDE tED eDE eED

b A

rEA rDA D yFD

x zA w

zB

zD

STANDARD MODEL
zC uCC C vCC vBB uBB B uBA uAA vBA A vAA x zA w zB b rEA rDA D yFA yFD sCD sCE E yFE F

zE
yFC

c
dDE tED eDE eED

zD

STANDARD MODEL
zC uCC C vCC vBB uBB B uBA uAA vBA A vAA x zA w zB b rEA rDA D yFA yFD sCD sCE E yFE F yFC zE

c
dDE tED eDE eED

zD

1 CHEP

ABC model used as the foundation for all pooling systems; applies to all types of equipment (pallets, RPC, IBC, CCC, Auto)
Standard terminology based on ABC model adopted globally Revenue and cost overlays linked to ABC model

Operational KPIs derived from ABC model, revenue overlay and cost overlay
CHEP 101 global training for all employees starts with ABC model TRIPS configured to match ABC model 100% All reports generated automatically Productivity and Quality projects developed around operational KPIs

PLANT NETWORK
Plants numbered P1, P2, P3, , Pn P = P1 + P2 + P3 + + Pn

All plants have stock A: A1, A2, A3, , An

Not all plants have stocks B and C. Pk = Ak + Bk + Ck

Subcontracted plants and temporary storage sites count as plants.

Each TPM location is registered as two locations: one with a D code and one with a P code (A code always, B and C depending on location). In TRIPS when a goods receipt is processed, the y is recorded. When y equipment remains at F at month end, it is assumed to be a yFP without transport and reversed out when the yFE or yFD actually occurs.

SINGLE PLANT STOCK MODEL

zC uCC C vCC sCD vBB uBB B uBA uAA vBA A vAA x zA w yFA b rEA A = rEA + rDA + yFA + vAA + vBA uAA a b x + w zA rDA zB B = b c + vBB uBA uBB zB

yFC

sCE C = yFC + a + c sCE sCD + vCC uCC zC

FIELD NETWORK

Emitters numbered E1, E2, E3, , En E = E1 + E2 + E3 + + En Transporters modeled as emitters; same as chained emitter

Distributors numbered D1, D2, D3, , Dn

D = D1 + D2 + D3 + + Dn

(The actual numbering will match the TRIPS codes used for plants and customers.)

EMITTER STOCK MODEL

zE yFE E rEA dDE tED eDE eED

sCE

E = sCE + yFE + dDE tED eED + eDE rEA zE

DISTRIBUTOR STOCK MODEL

D = tED + eED eDE + yFD + sCD rDA tDE dDE zD

dDE tED

eDE eED

sCD yFD D rDA

zD

CHAINED SUPPLY MODEL

OK to have chain of emitters

sCE1 rE1A
tE1E2

E1
tE2E1

yFE1 zE1

sCE2 rE2A

E2

yFE2 zE2

dDE2 tE2D

eDE2 eE2D

sCD rDA

yFD zD

TRANSPORTERS

Transporters modeled as emitters in transfer hire system (same as chained emitter); hold stock E. For one-way trip and exchange models, transporters do not hold stock.

NON PARTICIPATING DISTRIBUTORS

Distributor records in TRIPS contains a field for type of distributor, Participating or Non Participating. A Non Participating Distributor (NPD) is one who has not signed an agreement to be liable for loss or misuse. These are further defined as Cooperative, Semi-Cooperative, and Non-Cooperative. Report on NPD stock generated automatically by query on flows to/from distributors classified as NPD.

INTERNATIONAL FLOWS

Records for Plants, Emitters and Distributors in TRIPS contain a field for country in which they are located. Report on international flows are generated automatically by query on flows to stocks in countries other than country of origin. Vital metrics are based on global tracking. Options exist to comprehend country to country and region to region flows so that the stocks balance properly.

RECYCLERS

Assets recovered from recyclers and locations not currently in TRIPS are measured on flow w into A.

TPM

Assets move from D to A as they are checked in. Activity is recorded as rDA with zero transportation cost. Each TPM location is registered as 2 locations: one with a D code and one with a P code (A code always, B and C depending on location).

UNUSUAL FLOWS

dDE is an issue from a Distributor to an Emitter going out directly from a Distributor location (not TPM). We are investigating whether to discontinue this practice.
sAE is practiced in a couple of markets but should be discontinued as it is not consistent with our quality standards therefore not shown in model. In TPM, rDA is a virtual flow with zero transportation cost; assets move from D to A as they are checked in. yFA is discouraged, but is practiced in Automotive, IBC, RPC and the Canadian businesses for specific situations. New equipment should be delivered directly to a customer from F to avoid double transport. For pallet business, uCA and uCB are sinful, therefore not in the model. u flows are discouraged. Currently in TRIPS, the same transaction is used for yF flows as sC flows. Hence to prevent double counting of flows, y flows must be subtracted from s.

GLOSSARY

GLOSSARY

ABC Model
Plant (never depot) Transporter (not haulier or carrier) Emitter (not shipper) = manufacturers + growers + Distributor (not receiver) = retailers + distributors + Customer = all in Field = Emitters + Distributors ( + Hauliers ) Transfer (not dispatch): tED Issues = i = s + yFE + yFD + dDE q issues (exclude issues internal to Q such as dDE) q = s + yFE + yFD

GLOBAL VITAL METRICS

PLANT STOCK
zC uCC vCC C yFC sCE sCD c/(a+b) (c+B)/((a+b) u/i B zB $c/c w b vBA uAA vAA rEA A P/(q/22) or 28 C/(q/22) or 28

a
uBB vBB uBA

rDA
yFA

x zA w

i = s + yFE + yFD + dDE

ISSUES, RETURNS AND COLLECTIONS

yFC sCE E sCD dDE tED yFE F

C i y y/i

(r+w)/q
(rDA+dDE)/(tED+sCD+yFD) $r/r* $i/i* rEA A rDA

$$/i

yFD D

yFA w
i = s + yFE + yFD + dDE q = s + yFE + yFD

TOTAL STOCK KPIS

sCE E sCD

yFE F

T $$/T %$$/%T Q/T B dDE

T/i/28 or 35 days
yFD A D

T=A+B+C+D+E Q=D+E i = s + yFE + yFD + dDE

ABC MODEL
CHANGE LOG

V3.4a
Dropped the last two letters in the plant flows. The letters are not necessary since there in only one source and destination for these flows.

Lowered the yFE lettering on the chart, so it would not be confused with the yFC flow.
Clarification around handling y flows.

Added definitions for Distributors.

Modified metric pages to refer to the Vital Set.