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What can cause transportation costs to begin to increase if a manufacturing firm adds too many distribution centers to its network? Assume demand stays constant
What can cause transportation costs to begin to increase if a manufacturing firm adds too many distribution centers to its network? Assume demand stays constant regardless of the number of distribution centers. Question 3 options: a) A smaller proportion of customers will receive truckload shipments directly from the firm's manufacturing locations as more distribution centers are added. b) Customers are likely to increasingly demand higher levels of service, requiring an increase in expedited outbound less-than-truckload shipments. c) The distribution centers may no longer have the demand to support full truckload replenishment shipments from the firm's manufacturing plants, necessitating inbound less-than-truckload shipments. d) Less-than-truckload shipments make up an increasing proportion of outbound transportation mileage as more distribution centers are added
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