The fallacy of a common pool of inventory
Retailers engaged in omnichannel commerce need to abandon the common pool of inventory approach. Instead they should adopt a buy-one, replace-one approach for store replenishment and fill both store and online orders from a hybrid distribution center (DC.) Prior to adopting that approach, retailers should employ supply chain design software to determine the makeup of a hybrid distribution network. A network of hybrid DCs for omnichannel improves pick-pack-ship labor efficiency while minimizing distribution costs to boost profit margins.
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