The Warehousing Education and Research Council (WERC) recently published an article with content by Johnson Stephens Consulting, Inc. Principal Sandy Stephens, Ed Frazelle of Logistics Resources International and the Georgia Tech Logistics Institute, and Terry Harris of Chicago Consulting.
An excerpt from the full article as published in the January 2009 WERC Sheet…
As the price of a barrel of crude oil soared to nearly $150 within the last year, the impact on transportation costs reverberated throughout every supply chain….The mantra for many years in the design of distribution networks was to have as few distribution centers as possible while still maintaining an appropriate customer service level. “We spent a decade, at least, with transportation being the whole leverage point for network design,” points out Sandy Stephens, Principal, Johnson Stephens Consulting, Smyrna, Ga. “We leveraged transportation to have fewer buildings and less inventory. Now, with diesel fuel prices topping $4.00 a gallon [at that time], people are reviewing their network expense and seeing what opportunity there is for change.” “Lately we have been leaning toward having more DCs in a network,” says Edward H. Frazelle, President and CEO, Logistics Resources International, Atlanta, Ga….
WERC members can download the full article at http://www.werc.org/.