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Pedestrians in Toronto, 2013 (Source: Wikimedia Commons)

Serving a Few Major Customers Vs Many Diverse Customers

Idea posted: August 2016
  • Operations

Contrary to the accepted wisdom, manufacturers with a small number of major customers benefit from collaborative practices that lead to less demand uncertainty and greater inventory efficiencies. Manufacturers with a large number of disparate customers are the ones who must keep higher inventory level for longer periods of time, resulting in more inventory write-downs and reversals.

Idea #619
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Supply Chain Risk: Diversification Vs Under-diversification

Idea posted: December 2014
  • Operations

When catastrophe strikes a link in the supply chain, companies respond by dramatically diversifying their suppliers — only to eventually consolidate their suppliers as the memory of the disruption fades. This inconsistency is costly and ineffective.

Idea #468
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