Comments on: Still not direct shipping? –What a waste

By: Jon Gilbert

Jon Gilbert — Wed, 03 Sep 2008 14:32:40 +0000

This is certainly an interesting topic! I agree that postponement is the primary driver of today’s sophisticated networks.

To Christians’ point, the more that postponement can be localized, the lower the overall transportation cost, assuming sufficient volume.

For Glenn, postponed product completion occurs at the absolute latest and most distributed location – the actual end customer. That’s wonderful! But unfortunately, it’s not always an option for complex products, or when a lot of the value-add comes from setup.

The trick here is figuring out the tipping point and determining when volumes and transport savings are sufficient enough to balance the added DC operating costs or lost product value that comes from postponing.

I saw another well written article on postponement and DC bypass today. You might find it useful too:

http://www.scdigest.com/assets/On_Target/08-09-02-3.php?cid=1894

By: Glenn Lefkof

Glenn Lefkof — Fri, 29 Aug 2008 15:49:44 +0000

Some of our customers do the final integration of their product, functional test, etc. So after we do the assembly, they need to put it all together for shipment to the end customer.

But regarding component purchases, we purchased Analog Devices parts from Digikey. For failure analysis we had to ship the parts back to Digikey first who then sent the parts to ADI. How silly when ADI and Digikey are on opposite sides of the country. We took a dollar part and shipped it back and forth across the USA. And the parts got lost in the process, but later found.

That’s inefficient. And hopefully our complaints to ADI and DigiKey will make a difference.

By: Christian Verstraete

Christian Verstraete — Fri, 29 Aug 2008 06:26:30 +0000

At HP we are using different approaches for different products. And this has to do where the “postponement” takes place. If quantities are large enough and delivery delays OK, we will postpone at the CM/ODM site and direct ship. If not, we have distribution centers (also outsourced) in the regions to perform postponement and distribute. This gives us the flexibility to address customers/channel partner needs while keeping costs down. So, one size does not fit all with us.