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Supply Chain Strategies: Dont Ship Air and Dont Ship Water
The appearance of the principles dont ship water and dont ship air was mainly determined by two aims: optimizing the performance of supply chains and making it more green. Thus, the principle dont ship water implies reducing the waste of water and allocating plants in such a manner that the distance of water transportations is minimal. The principle dont ship air implies reducing empty space in transportation trailers. Coyle et al. suggest that there are two ways of accomplishing these tasks. Firstly, the relevant equipment can be filled or close to it. Secondly, the size of the packages should be reduced by the size of the goods (Coyle et al., 2010).
These strategies have had a significant impact on the global supply chains. Even though in the past, the problem of water waste was not as significant as it currently is, companies would still express concerns about reducing the costs of their supply chains and optimizing their performance. Thence, it was in the period of the Silk Road that companies began allocating critically important sites close to the water sources in order to minimize the transportation distance. The problem of packing was also acute at that time. Experts claim that exceedingly large containers would not often match the size of the transported goods that led to significant financial losses (Coyle et al., 2010).
According to experts opinion, these two principles are still taken into account in working out modern strategies of supply chain functioning. Hence, for instance, more and more companies have to make a shift to dont ship air, dont ship water approach in terms of the design of their packaging and product. Thus, for example, the dont ship air axiom seems to be particularly important now as the increase in the amount of transported goods has obliged companies to reconsider their packaging designs (Russell et al., 2016).
A few decades ago, manufacturers would use packages the size of which was considerably larger than that of the product itself. It was done to make customers think they purchased a larger volume of goods for a lower price. Now that the conditions have changed, companies try to redesign their packaging to make it lighter and smaller.
Russel et al. note that this strategy shift signifies critical outcomes for the supply chain strategy in general. First and foremost, it assists in reducing the weight and the size of the products and materials without doing any harm to their convenience and function characteristics (Russell et al., 2016). In other words, consumers do not normally notice any crucial changes that could make them refuse to purchase a particular product due to the changes in its design and packaging.
Secondly, the shift to these approaches is of great significance from financial perspectives. Thus, the optimization of a products design helps to reduce the cost of freight and packaging, as well as to perform space utilization more efficiently. Otherwise stated, a products redesign allows shipping more goods in one truck or container and utilizing shelf space in a more cost-effective manner, which leads to a considerable increase in revenue.
It is reasonable to assume that the strategies described above will become critical in the future due to the increase in the goods turnover and the fuels cost. In their pursuit to receive larger returns and enhance the green image, companies will do their best to avoid selling air and water .
Reference List
Coyle, J.J., Novack, R.A., Gibson, B., & Bardi, E.J. (2010). Transportation: A Supply Chain Perspective. Mason, Ohio: Cengage Learning. Web.
Russell, D., Coyle, J.J., Ruamsook, K., & Thomchick, E.A. (2016). The real impact of high transportation costs. Supply Chain Quarterly. Web.
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