New Hubs Arise to Serve Just in Case Distribution - Essay Example

The article notes that Just-in case distribution helps companies to reduce the cost of keeping large stock by ensuring just-in-time supplies. In addition, the just-in-case distribution also aids in reducing the cost of transportation since the shipping of goods is on demand. The article asserts that the just-in-case plan was a response to the vulnerable just-in-time supply chains. The article notes that just-in-time management exposes companies to a greater risk of running out of merchandise in case of disruptions. Indeed, the article reckons that combining the just-in-case with a just-in-time strategy was a means of seeking a balance between holding the minimum inventory possible and yet never running out of stock.

The just-in-case just-in-time distribution strategy expands and increases the network of distribution centers hence reducing the distance by moving the inventory close to the customers. Apparently, the article shows that companies can achieve greater efficiency upon transporting their goods to the customers immediately. As such, many companies seek competitive advantage amidst stiff competition arising in the market by offering excellent customer service. Multiple and strategically place distribution channels help in minimizing the time, money, and distance spent in delivering merchandise to the customers. However, the article observes that retailers often avoid transporting merchandise to the last mile by directing the nearby customers to collect their merchandise from the nearby shop.

From the content of the article, I feel that the Just-in-case is an effective strategy in supply chain management. Indeed, the just-in-time management exposes companies to a greater risk of running out of merchandise in case of disruptions. I, therefore, relate the article with the benefits of the just-in-case management that allows retailers to enjoy a lot of stability since there is efficient distribution of goods and they do not have to rely on one distribution center unless there is a strong and valid business reason to do that. In addition, the retailers benefit since the items are much closer and delivery of the merchandise takes less time. Moreover, it is true that companies can gain a competitive advantage by establishing the capacity to serve customers well and the ability to retain them due to the excellent service.

 However, two questions arise from the strategy. First, would the just-in-case just-in-time strategy really work in the event of a major disruption in the main distribution channel? The strategy might not work because the lack of merchandise will jeopardize the operations and profitability of distribution centers. Secondly, is the strategy really economical or cost-saving? Although the strategy is economical, close monitoring of the costs will be paramount since the more the distribution channels the higher the cost involved.