K 2 A coffee mug maker makes 15 different colors of mugs. It decides to postpone thecoloring step in the mug manufacturing process and instead supplies all mugs in aneutral color to its main distributors. It also supplies those distributors with color kitswith different colors, who then paint mugs when customer demand for specific colormugs become clearer. This practice is called postponement and works best when:a. Demand at the customer level is uncertainb.The cost of shifting a work step in the process to a later time /another location(say cost at the distributor end - addl equipment, worker training for paintingmugs and so on) is not higher than the postponement benefits of customizingproducts closer to the occurrence of demand (lower stockouts or excessinventories and such).c. When the mug maker can achieve high economies of scale making just one(neutral) color of mugs and/or is not saddled with high fixed costs from thepainting equipment it currently owns.d.When the work step being postponed is modular (that is) can be separated fromthe rest of the product manufacturing processe.All of the above are important factors in making postponement decisions

Postponement in supply chain management refers to the strategic delay of certain manufacturing or…

Answered: A coffee mug maker makes 15 different…

Principles Of Marketing

17th Edition

ISBN:9780134492513

Author:Kotler, Philip, Armstrong, Gary (gary M.)

Publisher:Kotler, Philip, Armstrong, Gary (gary M.)

Chapter1: Marketing: Creating Customer Value And Engagement

Section: Chapter Questions

Problem 1.1DQ

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