Location Still Matters

This article appears in the The Fall, 2002 issue of ACCESS, the official magazine of the University of California Transportation Center. "As better communications bring faster, more reliable, and more efficienthandling and movement of goods, competition requires freight companies to befast, flexible, precise, and cost-sensitive. New practices like just-in-time productionand, more recently, demand-side inventory management and customerorders placed on the web are contributing to a new business model in whichstorage plays a lesser role and mobile inventories are the norm.Yet the industry does not float out there somewhere in cyberspace. As in theold days, it remains rooted in local and regional geographies, but in new ways.One of the reasons the online retailer Webvan failed was that it did not payenough attention to the fact that even virtual commerce is accompanied by—anddepends on—physical distribution in material time and space. The integratedmanagement of materials supply, manufacturing, distribution, and consumption—known as "supply-chain management"—also has important spatial implications,including enlarged geographic range and concentration of logisticsfunctions at strategic locations." Editor's note: The link below is to a 1.4 MB PDF document.

Thanks to ACCESS Editor