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Chapter 5; Distribution Networks, basically pizza perfect has it own…

- - - - 3. Relationship between number of facilities and transportation cost, basically cost decrease till a certain point, where it then number of facilities increase and so does the cost of transportation.
        
        Relationship between number of facilities and facility costs;
        Facility costs decrease as the number of facilities is reduced, because a consolidation of facilites allows a firm to exploit economies of scale.
        
        Total logs costs are the sum of invent, transportation and facility costs for a supply chain network. As the number of facilities increase, total logs costs first decrease and then increase as shown, in 5. Each firm should have at least the num of facilities that minimizes total logs costs.
        
        in order for a firm to reduce response time to its customers further, it should increase the number of facilities beyond the point that minimizes logs costs
        
        a firm should add facilities beyond the cost-minizine point only if managers are confident that the increase in revenue because of better responsiveness is greater than the increase in costs because of the additional facilities
        
        5. Variation in Logs cost and response time with number of facilities; the cs and cost components listed earlier are the primary measures used to evaluate different delivery network designs. In general, no distribution network will outperform others along all dimensions. Therefore, it is important to ensure that the strength of the distribution network fit with the strat position of the firm
- - - - aggregation, is achieved only if the mfter can allocate at least a portion of the available inventory across retailers, on an as-needed basis.
      - Centralization are highest for high-value, low-demand items with unpredictable demand.