ABSTRACT
This case describes the role of consolidation centers in the “lean” supply chain. The description here articulates the rules for designing a consolidation center, a supply chain “middle man,” that makes the total chain more effective. Consolidation centers are playing an increased role in many supply chains, particularly as feeders to manufacturing operations that produce complex products with many components. Every supplier can’t or won’t link its operations with its customers. The consolidation center enables this linkage — at least until better suppliers can be found. In some cases, consolidation centers are under the control of third-party logistics providers responsible for ordering material, its transportation, and its preparation for the manufacturing center.
