Analysis of the order recovery point location in the supply chain Online publication date: Thu, 09-Jul-2015
by Marina Ivanova; Joachim Kaeschel; Dmitry Ivanov
International Journal of Integrated Supply Management (IJISM), Vol. 9, No. 4, 2015
Abstract: The order penetration point (OPP) determines the point at which the customer enters the supply chain (SC) with their individual product-related preferences. The OPP therefore separates the demand-driven parts from customer order-driven parts in the SC. Another concept - the order recovery point (ORP) - is also frequently used in practice to determine the last stage at which the customer's individual preferences can be taken into account. Therefore the ORP determines the stage where the customer leaves the SC. This paper introduces the ORP concept and investigates the issue of how to determine the ORP's location in the SC. We analyse the factors which influence the ORP location and propose a formula for its location. The results of this study can be applied as a strategic decision-making support of the ORP location determination and provide deeper insights into SC efficiency and agility from the point of view of ORP location.
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