The degree of inventory centralization for food manufacturers

For food manufacturers, limited shelf-lives and ‘freshness’ requirements increase inventory holding costs. Accuracy in choosing the most advantageous degree of inventory centralization (MADIC) is therefore central for competitiveness. While extant research contains several industry-generic factors t...

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Bibliographic Details
Published in:Production engineering (Berlin, Germany) Germany), 2019-02, Vol.13 (1), p.21-32
Main Authors: Corts, Nona Fortian, Herbert-Hansen, Zaza Nadja Lee, Larsen, Samuel Brüning, Khalid, Waqas
Format: Article
Language:English
Subjects:
Case depth
Engineering
Food processing
Food processing industry
Freshness
Industrial and Production Engineering
Manufacturers
Manufacturing
Production
Production Management
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Summary:For food manufacturers, limited shelf-lives and ‘freshness’ requirements increase inventory holding costs. Accuracy in choosing the most advantageous degree of inventory centralization (MADIC) is therefore central for competitiveness. While extant research contains several industry-generic factors that influence centralization decisions, influencing factors for food manufacturers, in particular, is under-explored. This paper identifies the factors that influence the MADIC for food manufacturers and develops a method that integrates all factors for MADIC-determination. The study examines a single case facilitating deep-dives into unknown areas. Results show nine factors of which three are specific to food manufacturing. Furthermore, the paper details how practitioners can determine a MADIC-score on a 1–100 scale for their particular operations. While food manufacturing inventory centralization literature is scarce, this paper contributes to a holistic study of multiple relevant factors and a method that integrates all factors into one result.
ISSN:0944-6524
1863-7353
DOI:10.1007/s11740-018-00872-1