What is Included in Logistics and Supply Chain Management Cost Measures?
Logistics and SCM cost can be broken down in three separate, but complementary pieces: internal logistics and SCM costs, outsourcing logistics and SCM costs and inventory carrying costs. The proportions of these costs vary widely by sector. For example, in a JIT mode, internal logistics and SCM costs tend to increase, but this is balanced by a reduction in the inventory carrying costs; this happens in volatile sectors, such as upscale clothing, automotive, computers and perishable goods.
