Raw materials can create a sourcing issue for businesses. How can a business reduce this potential for a bottleneck? O Dual source the raw material from more than one location, thus spreading risk around. Consolidate raw material distribution centers to increase efficiency. O Decrease inventory on hand to reduce warehousing costs. Increase SKUs in product portfolio to create a diversity of products.
Material is an important resource for any organization that is into manufacturing products for their customers. It is the most basic component that helps drive a business to reach its potential. Regulation and flow of materials and goods is the never-ending cycle of business that constitutes the majority of the sales thereby generating revenue for the business. Business selects their location based on the availability of materials so that the production process can be handled easily. Material handling is not a simple task and requires heavy costs to properly manage the warehouses. Some organizations have their own storage spaces that help incur less cost as compared to those companies that rent out warehouses for storage purposes.
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