Postponement strategy in food supply chains an empirical investigation

Abstract

The purpose of this paper is to investigate the relevancy/feasibility of the postponement strategy in food supply chains. The paper also aims at discussing the windows of opportunities for the growth of use of postponement by identifying the factors/drivers/enablers in the adoption of this strategy. It is out of the scope of this paper to survey a specific market/country, or answer how much or how many; it only captures as many cases as possible and build a categorised picture of postponement against the various food commodities by using semi-structured interviews. Our research results show that food postponement is a relevant strategy across the different types of food commodities/categories (frozen, chilled/fresh and long shelf life). Moreover, the results also show that this is not limited to one form of postponement as one may expect (such as logistics postponement or repacking display packs for instance), but is in fact related to the various forms of postponement.

Coping with the postponement boundary problem: an empirical investigation in global food supply chains

“…Lastly, in line with some recent contributions (e.g., Bandaly and Hassan, 2020), this study empirically illustrates the importance to keep inventories of finished products close to final customers in this not only due to service level requirements (i.e., being able to deliver on time - Abukhader and Jonson, 2007) but also because of shelf-life constraints. Indeed, shelf-life requirements can be so strict to make it impossible to deliver food products from any region other than the Destination one (including the Home region) (Ferreira and Alcântara, 2015;Bandaly and Hassan, 2020).…”

“…Nevertheless, some scholars investigated postponement applications also in the food industry, considering wine manufacturers (van Hoek, 1997), soluble coffee producers (Wong et al, 2011), and orange juice producers (Ferreira and Alcântara, 2015;Bandaly and Hassan, 2020). This industry is characterized by non-modular products with relatively short shelflife (Yang et al, 2004;Abukhader and Jonson, 2007). Postponement can provide benefits related to lower uncertainty (van Hoek, 1999;Brun and Zorzini, 2009), entailing inventory carrying and transportation costs reduction (Bandaly and Hassan, 2020).…”

A Historical Review of Postponement Research

“…A sample of the many examples of postponement implementation in global markets includes the manufacturing and distribution of computers, related components, and peripherals in Taiwan (Chiou et al. ), consumer electronics retailing in Europe (Appelqvist and Gubi ), food retailing in Europe (Abukhader and Jonson ), soluble coffee in the United Kingdom (Wong et al. ), textile and apparel in the United States (Chaudhry and Hodge ), and dairy distribution on a global basis (Van Kampen and Van Donk ).…”

Make to stock and mix to order: choosing intermediate products in the food-processing industry

“…The problem here is that standardization is often difficult to achieve, as customers nowadays demand more and more product variety. For this reason, Abukhader and Jonson (2007) encourage food companies to analyze their product mix and product development process in detail, to see where postponement can be applied.…”