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An online retailer of a single product has four major markets in the four "corners" (North-East, South-East, North-West and South-West) of a country. Assume that daily demand in each market is exactly 10 units. The retailer currently has a distribution center located in each of the corners to ensure that customer orders can be fulfilled quickly. The distribution center replenishes its inventory from the manufacturer at a unit cost of $3200 and a fixed ordering cost of $62500 per order. The cost of capital for this retailer is 0.2 $/$/year. There is now a proposal to consolidate the inventory of this firm at one central distribution center and to close the four regional distribution centers. Assume that sales will not be affected by the increased order fulfillment times caused by this change to the supply chain. How does the cost per unit (taking ordering costs and inventory holding costs also into account) change for this retailer by this supply chain change?
What are the different types of strategies? What are the differences among these strategies? How do you determine which type of strategy is most appropriate for your organization?
One of the constants in organizations is the presence of change. In almost all change scenarios, human behaviour is impacted. However, organizational members often resist change. W
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