Supply chain managers should re-think their network design in the time of high fuel prices
Filed in archive Research by ehsan on March 25, 2008
In a recent article by SC Digest, Dr. Simchi Levi mentioned that every $10 increase in oil prices leads to 4 cent per mile increase in transportation rates. This can act as a heavy force for change in the current designs of the firms' supply chain network.

As you can see in the above photo which is a snapshot from a simulation, as the oil prices increase, supply chain network design shifts to more distribution centers dispersed in different geographical parts of the market.
Has your company started such initiative recently?
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scm supply chain management network design mit fuel cost oil rise distribution 2007 supply+chain
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