Capacity utilization consolidation

The benefits of consolidation can include superior capacity utilization, the sharing of best practice process improvements, the elimination of overlaps in the distribution system, and the use of geographically closer plants for sourcing. Research and development and sales and marketing expenses can also be cut back by eliminating duplications in operations. Some non-traditional players (e.g., financial investors) have been able to slash their sales, general and administration costs by as much as 40 percent on the back of consolidation moves. 

Logistics management Consolidated service center, integrated transport network, capacity utilization 0.5-2 %... 

Consolidation in a supply chain refers to the accumulation of product in a central location in order to take advantage of economies of scale in manufacturing, warehousing, and transportation. The basic economic reason for consolidation is to increase utilization of fixed capacity and thus gain the associated cost reduction. When many products share capacity, there is the opportunity to decrease delivery sizes across products. 

Aggregation of demand from two or more sources can lead to better utilization of capacity (Gerchak and He 2002). As shown in Fig. 2.6, demand consolidation can take multiple forms that include use of distribution centers, product bundling, demand aggregation (over a wide window ), combining customer deliveries as in home-delivery, and online selling that combines customer orders. 

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