Friday, May 19, 2006

Impact of Supply Chain Costs on the Bottom Line


How much does it costs to move goods through your supply chain ? Has there been research on what percentage of sales goes into the supply chain? Well, this table shows that companies that manage their supply chains carefully tend to keep logistics costs to around 9.5% of their sales. Without any substantiated data, I would put forth a guess that many companies which do their manufacturing in China, India or Indo-china would tend to have logistics costs at about 15% of their sales due to the lack of sophistication in their SCM. Anyone want to dispute this ?

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