Continuous Replenishment Lowers Logistics Cost

Companies with continuous replenishment programs need fewer employees in the logistics function.

Continuous replenishment programs provide an opportunity for suppliers and customers to work together to establish logistics processes that create value for both parties.

Delivery Quality

Organizations using continuous replenishment programs have only slightly higher perfect order performance than organizations without these programs (Figure 2). APQC defines perfect order performance as the percentage of deliveries made on time; arriving complete correct, and without damage; and arriving with an accurate invoice.

At the median, there is only a 1 percent difference in perfect order performance between organizations with continuous replenishment programs and organizations without these programs. These results indicate that the benefits resulting from continuous replenishment programs are primarily in the areas of efficiency and cost effectiveness rather than quality.

Discuss this Article 1

josephmartin
on Feb 1, 2013

Continuous Replenishment Lowers Logistics Cost,and the goods cost would also be reduced. All such factors like "fewer employees and supply according to customer need" if all this is taken into account. The above factor would reduce the amount of organizations with continuous replenishment programs spend on logistics.

Please or Register to post comments.

Subscribe to IW Newsletters

IW Marketplace - Buy a Link Now