What is Distribution inventory

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National Network of DSD Distributors & Retail Owners

Mr. Checkout is a network of over 1,100 independent distributors and 50,000 independent retail owners across the USA, parts of Canada and the Caribbean. Distributors and independent retail owners use Mr. Checkout to find new products that are ready for retail and can handle rapid growth through independent channels.

 

 

 

 

Define Distribution inventory

distribution inventory is the result of a distribution network and the increases in inventory needed to operate out of multiple distribution points. When you decide to have two or three or more strategically located distribution centers rather than a single centrally located distribution center, you will generally increase your overall inventory levels. The reason for this is you are now breaking up your demand among three locations. When demand is broken up (disaggregated) you will usually find greater variability in the demand at each location. This increase in variability results in increases in safety stock in order to meet desired service levels. This increase in safety stock is essentially your distribution inventory. Some practitioners consider all inventory in the distribution network to be distribution inventory. I disagree with that definition, since much of that inventory would exist regardless of the distribution network.

 

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DistributorNational Network of DSD Distributors & Retail Owners

Mr. Checkout is a network of over 1,100 independent distributors and 50,000 independent retail owners across the USA, parts of Canada and the Caribbean. Distributors and independent retail owners use Mr. Checkout to find new products that are ready for retail and can handle rapid growth through independent channels.