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Building Postponement Capability

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  • Katsuyoshi Takashima

    (Graduate School of Business Administration, Kobe University)

Abstract

The basic concept of postponement is to delay activities until the latest possible point in time when more accurate information is available. In the Bucklin-type postponement-speculation model of inventory decision, to shorten the delivery lead time or lessen the delivery lot size from suppliers to retail stores is considered postponement. In a competitive environment, a given retailer cannot gain a competitive advantage alone by conducting longer postponement than other retailers. This is because other retailers can also achieve postponement by making transactions with wholesale and manufacturing companies which have established the logistics information system. The ability to construct the postponed system that is difficult to imitate is called postponement capability. The postponement capability can be realized under at least four conditions; partnership with suppliers, order management at retail stores, strategic expansion of scale, and brand strategy. These conditions can allow a retailer to establish a competitive advantage based on the postponed distribution system.

Suggested Citation

  • Katsuyoshi Takashima, 2010. "Building Postponement Capability," Discussion Papers 2010-29, Kobe University, Graduate School of Business Administration.
    • Handle: RePEc:kbb:dpaper:2010-29
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    File URL: https://www.b.kobe-u.ac.jp/papers_files/2010_29.pdf
    File Function: First version, 2010
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