Describe The Difference Between Logistics And Supply-To-Stock Marketing Strategy
e. Pricing Policy
• Changes in the pricing policy will affect products to be purchased or sold as well as the logistics strategy, primarily because it identifies responsibility for different logistics activities.
• The transfer of title to products and the responsibility for transportation in the distribution channel are affected by price policy.
• Even though costs are transferable through the logistics channel no matter how they are allocated by the pricing policy, some companies design their logistics network according to the costs for which they are directly in charge.
• When a company has a price mechanism where the consumer pays for the delivery of products, the resulting strategy is probably to be one where there are few stocking points, unless
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• Basically, there are two significant strategies: supply-to-stock and supply-to-order.
• To meet a variety of product and demand characteristics, a mixture of these two strategies are blended.
• A supply-to-stock strategy refers to develop the supply channel for maximum efficiency.
• Inventories are held to realize good economies by granting economical production runs, batch order processing, purchasing in quantity, and dispatching in large shipment sizes.
• Safety inventory are used to achieve high levels of product availability.
• Inventories are normally used to meet demand, but inventory levels are held to a minimum with strict control.
• On the contrary, a supply-to-order strategy refers to develop the supply channel for maximum responsiveness.
• Flexible processing, quick changeovers, short lead times, excess capacity, premium transportation, and single order processing are features of the supply channel.
• Various postponement strategies are deployed to defer the implementation of product variety as long and as far down the supply channel as
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