Logistics Postponement in International Distribution System: System Dynamics Approach to Decision Making

Abstract

Goal of the research: To develop a decision making tool suitable for examining the extent of logistics postponement implementation within international distribution system consisting of central warehouse, regional warehouses and customers outlets Main tasks of the research:  To identify factors influencing the implementation of logistics postponement in the context of international distribution of goods  To develop hypothesis about how particular factors affect the extend of logistics postponement implementation  To identify measurement constructs for the degree of logistics postponement implementation  To choose suitable decision support method for the tool development  To develop a tool by incorporating in it the structure of distribution system, forecasting, inventory, purchasing, ordering, shipment, obsolescence policies, parameters, variables, decision variables and objective function  To test the model on numerical example and check for its validity Results:  Factors influencing logistics postponement in international context were identified  Hypothesis about customs tariff, lead time length and demand uncertainty were developed and proved  The decision making tool was developed based on system dynamic approach using simulation method and further tested on actual company’s data  Validation tests were conducted, the model was shown to have validity in its performance  Main theoretical, empirical, managerial implications as well as contributions for further research were discussed