A logistics manager is asked to perform a total cost analysis for the organization. Which of the following trade-offs is critical to consider?
A) Inventory carrying costs vs. production costs
B) Distribution costs vs. order processing costs
C) Transportation costs vs. inventory carrying costs
D) landed costs vs. production costs

Question

Quizplus · Accepted Answer

The trade-off between transportation costs and inventory carrying costs is critical to consider as both have a significant impact on the total cost. Higher transportation costs may lead to lower inventory carrying costs while lower transportation costs may lead to higher inventory carrying costs. Therefore, a logistics manager needs to strike a balance between these two costs to optimize the total cost.

A Logistics Manager Is Asked to Perform a Total Cost