Reebok, a leading sportswear company, could use a “partial postponement” strategy to satisfy the demand for each of their star players with both decorated and blank shirts. This strategy would involve having plain apparel on hand ready to be printed or embroidered in response to orders placed by customers. Postponement is an inventory management tool that helps organizations increase customer service levels while reducing costs (Küsters & Kollmann, 2018). This strategy could provide several advantages for Reebok:
Firstly, the company would no longer need to maintain large amounts of pre-decorated stock on hand. By holding only plain apparel in warehouses they can reduce storage requirements and save money by not having to pay warehousing fees (Küsters & Kollmann, 2018). Secondly, as customer orders come in Reebok could respond quickly and ensure that each order accurately meets the individual customer’s needs (Küsters & Kollmann, 2018). If an order changes or comes in late then it does not become wasted product since it has yet to be customized for specific customers. Additionally this approach allows Reebok more flexibility since they can adjust production runs based upon demand trends – resulting in fewer left over inventory items at season end (Küsters & Kollmann, 2018).
Could Reebok use a “partial postponement” strategy, satisfying demand for each star player with dressed and with blank shirts?
Determining appropriate order quantities under this partial postponement strategy requires careful consideration of a range of factors including consumer demand patterns and lead times. To begin with Reebok will need accurate forecasting information available so they can anticipate how much product needs to be held in stock during any given period – taking into account expected consumer behavior as well as seasonal fluctuations (Gobet et al., 2020). In addition an assessment should also be done regarding potential lead times which includes all aspects from supply chain through manufacturing and delivery processes so that executives have realistic expectations of when certain products can arrive at stores or warehouses (Gobet et al., 2020). Lastly inventories should always strive for balance between stocking too much versus too little – often referred to as finding ‘the Goldilocks point’ where there is enough stock but not too much excess tied up unnecessarily (Gobet et al., 2020).
In conclusion Reebok could benefit from implementing a “partial postponement” strategy as it would provide cost savings from reduced warehouse space requirements along with increased flexibility when responding quickly to customer orders. Appropriate order quantities must take into account forecasting information regarding anticipated demand patterns and potential lead times so that an optimal balance between stocking too much versus too little is achieved.