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1 Acquisition Cost Management Cost Maintenance Cost Operating Cost Training Cost Disposal Cost Inventory Cost Technical Support Cost The total cost of.

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Presentation on theme: "1 Acquisition Cost Management Cost Maintenance Cost Operating Cost Training Cost Disposal Cost Inventory Cost Technical Support Cost The total cost of."— Presentation transcript:

1 1 Acquisition Cost Management Cost Maintenance Cost Operating Cost Training Cost Disposal Cost Inventory Cost Technical Support Cost The total cost of ownership

2 2 Shopper behaviour when faced with a stock-out Source: Corsten, D. and Gruen, T., ‘Stock-outs cause walkouts’, Harvard Business Review, May 2004

3 3 The impact of logistics and customer service on marketing Consumer franchise Customer franchise Supply chain efficiency Marketing effectiveness ● Brand values ●Corporate image ●Availability ●Customer Service ●Partnership ●Quick response ●Flexibility ●Reduced asset base ●Low-cost supplier ●Market share ●Customer retention ●Superior ROI

4 4 Linking customer value to supply chain strategy Identify value segments Define the value proposition Identify the market winners Develop the supply chain strategy What do our customers value? How do we translate these requirements into an offer? What does it take to succeed in this market? How do we deliver against this proposition?

5 The ‘Pareto’ or 80/20 rule 5 ‘A’‘B’ ‘C’ 20%50%30% 15% 80% % Products/customers % Sales/profits 5%

6 6 Customer service and the 80/20 rule A B C ABC Key products, key accounts (protect) Customers Products Develop Maintain Review


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