Warehousing Has Long Been Considered the Primary Function of Wholesaling

question 92

Essay

Warehousing has long been considered the primary function of wholesaling. How has the development of distribution centres altered the traditional wisdom? Why does this approach represent a total system effort?

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Definitions:

Allocation Base

A measure or quantity, such as labor hours or machine hours, used to assign costs to activities or objects.

Machine Hours

A measure of the total time machines are operational within a specific period, often used in activity-based costing or allocation.

Factory Overhead Rate

A calculation used to allocate manufacturing overhead costs to individual units of production, based on a certain base such as labor hours or machine hours.

Machine Hours

A measure of production time, tracking the total hours that machinery is in operation during the manufacturing process.