A tool for deciding upon and producing the optimal quantities of products needed from each plant to supply distribution warehouses/centers with sufficient products to meet customer demand with minimal costs and risks incurred.
Comments: Since multiple plants often collaborate to supply customers with products across a large geographic area a comprehensive distribution management system is very helpful in maintaining minimal product quantities without risking out-of-stock problems that ultimately hurt customers and company.
Overstocking warehouses would be one of the “7 Wastes” causing a company to lose money invested in inventory, risk obsolescence, and need larger warehouses, etc.