Logistics and Supply Chain Management, 6th Edition

Laying the foundations for synchronisation

In the same way that the conventional wisdom in production and manufacturing is to seek economies of scale through larger batch quantities, similar thinking can often be found in the rest of the supply chain. Thus companies might seek to ship by the container or truck load. Customers are discouraged from ordering in smaller quantities by price penalties, and delivery schedules are typically based on optimising the efficiency of routes and the consolidation of deliveries. Clearly such an approach runs counter to the requirements of a synchronous supply chain. Under the synchronisation philosophy the requirement is for small shipments to be made more frequently and to meet the precise time requirements ...