Wednesday, 4 January 2017

Customer Focus in Time Compression Approach

Different service needs are found in the different product and market sectors. Channels with distinct logistical capabilities are used to meet these individual needs. If this wasn’t the case, a single channel would be used and some customers would be overlooked while others were overserved, resulting in negative effects on costs, customer service and profitability.

There are two basic supply chain approaches. One is agile and the other one is a lean supply.  There are many products that fall into each category. A good example of an agile supply chain product is fashion and a lean supply chain is commonly used for industrial chemicals. Some products require a good mix of both approaches.
  • Products that have variations in demand patterns need to provide flexible supply operations in order to reduce the risks that come with volatile markets.
  • Products with stable demand that is more predicable have cost focused supply approaches that have lower unit costs thanks to the stricter management control and large economies of scale



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