Global supply chain design: understanding costs through dynamic modelling

Steve Disney, Peter McCullen

Research output: Chapter in Book/Conference proceeding with ISSN or ISBNConference contribution with ISSN or ISBN

Abstract

We study the economics of the outsourcing decision from a supply chain dynamics perspective. Production can be either in the UK, where products are delivered on trucks to a UK warehouse, or in China where product is shipped via a container liner to a UK warehouse. We show that the traditional “landed cost” approach of purchase price plus transport costs overestimates the benefit from outsourcing products to China. However, the dynamic costs associated with the pipeline inventory, the UK inventory & the UK warehousing capacity costs associated with unloading the containers is not large enough to change the outsourcing decision.
Original languageEnglish
Title of host publicationProceedings of the 18th International Symposium on Logistics: Resilient Supply Chains in an Uncertain Environment
Place of PublicationNottingham
PublisherCentre for Concurrent Enterprise, Nottingham University Business School
Pages723-731
Number of pages9
ISBN (Print)9780853582922
Publication statusPublished - 7 Jul 2013
EventProceedings of the 18th International Symposium on Logistics: Resilient Supply Chains in an Uncertain Environment - Vienna, Austria, 7-10th July, 2013
Duration: 7 Jul 2013 → …

Conference

ConferenceProceedings of the 18th International Symposium on Logistics: Resilient Supply Chains in an Uncertain Environment
Period7/07/13 → …

Bibliographical note

© 2013 Nottingham University Business School

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    Disney, S., & McCullen, P. (2013). Global supply chain design: understanding costs through dynamic modelling. In Proceedings of the 18th International Symposium on Logistics: Resilient Supply Chains in an Uncertain Environment (pp. 723-731). Centre for Concurrent Enterprise, Nottingham University Business School. http://www.isl21.net