Article
Increasing customer value and decreasing distribution costs with merge-in-transit
A broad product assortment is usually valued highly by customers. However, holding a great number of product variants in inventory increases the costs of a supplier. It is possible to reduce need for warehousing with direct deliveries from manufacturing units, but customer value is reduced when orders are received on several shipments. Merge-in-transit is a distribution method in which goods shipped from several supply locations are consolidated into one final customer delivery while they are in transit. This article examines the effects of merge-in-transit distribution on delivery costs. The analysis is performed with a maintenance, repair, and operations products distributor as the case company. The evidence in this article supports the claim of merge-in-transit being a cost efficient distribution alternative in business networks. Based on the results advocates that companies in multi-company networks should study the possibility of using the merge-in-transit delivery model.
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Using Value Reengineering to Implement Breakthrough Solutions for Customers | Vol. 10 Issue: 2, pp.1-12 | en |