Application of function cost analysis and network scheduling in logistics cost management

Dynamic nature of logistic costs as well as dynamic and complicated modern economic environment urges scientists to seek new and improve existing forms and approaches to identification, accounting and management of companies’ logistic costs and supply chains. Adaptation of logistic cost management to modern challenges is important. Business competitiveness nowadays depends on fast and exact reaction of business management on unpredictable, changing and risky micro- and macro environment. Clear and available technologies of influence on profitability of economic activity due to rational decreasing and optimization of expenses become more and more demanded on Ukrainian and world markets. Rational planning and minimization of logistic costs of operational activity of production and commercial companies is great potential reserve and powerful tool on the competitive space if used by experienced specialists. In the article it is proposed to combine powerful methods - function cost analysis and network planning on the basis of process, project and logistics management using simplified example. As a result, the client’s demands concerning shortening terms of the order with optimal cost and quality of service for both or more sides are fulfilled. At the meantime the riskiest sites of supply chain are determined that allows to predict and avoid possible problems. The material needs further specification, economic and mathematical modelling, and professional discussion by specialists in management of supply chains, operational managers, IT-specialists, as supply chains are complicated open and flexible systems