Supply chain management allows firms to recognize and solve distribution problems that many firms face today. Many retailers use distribution centers to streamline merchandise flow. The distribution center acts as the mediator between the supplier and the store location, preparing the merchandise to be "floor-ready." There are several different activities the distribution center performs. The following exercise examines the different distribution center activities.
Distribution centers are often more advantageous for retailers because of multiple factors. Distribution centers enable the retailer to carry less merchandise in the individual stores. This, in turn, lowers inventory investments systemwide for retailers. The distribution center performs the following activities: coordinating inbound transportation; receiving, checking, storing, and cross-docking; getting merchandise floor-ready; and coordinating outbound transportation.