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In many ways, this runs contrary to the classic definition of distribution in which we buy in pallets and sell in cases. Picking one or two pieces instead of a pack of 12 seems like suicide in the warehouse!
Breakthroughs in process flexibility now permit manufacturing in efficient lot sizes of one. But, even though the lead-time has been greatly reduced from the past, the manufacturing lot size of one does not satisfy the immediate needs of critical service parts or the off-the-shelf impulse purchase at the retailer. These needs require inventory at the point of sale.
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ABOUT THE AUTHOR
James M. Apple, Jr. is a Director in The Progress Group. Prior to co-founding The Progress Group in 1991, he was a Partner with Coopers & Lybrand's SysteCon division. During 1992-1995 he served as a Senior Systems Advisor with Vanderlande Industries, a major conveyor and systems provider in Europe.
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