holding stock

Holding stock close to the customers (at the retail sales outlets):

Advantages:
Customers can see and get the product immediately;


Disadvantages:
Requires additional space for each outlet to have a small storage area to hold the stock and incur more land cost and stock control staff;


Holding stock centrally (in the centralized distribution centre/warehouse:

Advantages:
Can save the additional space for each outlet to have a small storage area to hold the stock and save the land cost and the stock control staff cost;

Disadvantages:
Customers can only see a sample and might not get the product immediately; delivery services will be required;

In general, the strategy will depend on:
The daily sales volume;
Size of product;
Customers’ need for immediate stock availability;
Time to get the product from the central warehouse to the customers, etc.