Total Cost Presentation


0

It is the common practice to focus on inventory and transportation as the two main network design factors, which are sufficiently broad to include activity and functional cost relationships.

 

In terms of inventory, total cost includes all expenses related to inventory carrying cost and customer ordering. Inventory carrying cost includes all taxes, storage; capital, insurance and obsolescence .The cost of ordering includes the full expense of inventory control, order preparation, communications, update activities and managerial supervision.

 

The total cost of transportation includes for – hire transport expenses and accessories charges plus costs related to the hazards incurred with the various modes, legal forms of transport, and associated administrative expenses.

 

The basic logic for focusing on transportation and inventory, as key factors are that they represent the spatial and temporal dimensions of logistical operations. Transportation deals with the geographical (spatial) dimensions of logistical operations by positioning the product where the customer wants to purchase. Inventory involves the rate at which capital assets are used (temporal) to meet customer requirements by having product available when the customer wants to purchase.


Like it? Share with your friends!

0
BMS Team

We, at BMS.co.in, believe in sharing knowledge and giving quality information to our BMS students. We are here to provide and update you with every details required by you BMSites! If you want to join us, please mail to [email protected]

2 Comments

Facebook comments:

Choose A Format
Personality quiz
Series of questions that intends to reveal something about the personality
Trivia quiz
Series of questions with right and wrong answers that intends to check knowledge
Poll
Voting to make decisions or determine opinions
Story
Formatted Text with Embeds and Visuals
List
The Classic Internet Listicles
Countdown
The Classic Internet Countdowns
Open List
Submit your own item and vote up for the best submission
Ranked List
Upvote or downvote to decide the best list item
Meme
Upload your own images to make custom memes
Video
Youtube, Vimeo or Vine Embeds
Audio
Soundcloud or Mixcloud Embeds
Image
Photo or GIF
Gif
GIF format