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les volume and minimize sales waves, surges, and declines. The JustInTime technique attempts to reduce inventory to minimal levels in concert with the Japanese belief that inventory is an unnecessary evil. As the technique is applied in production, suppliers to the automobile industry have cha nged their marketing approach. Suppliers39。 physical distribution primarily involves the product flow. However, an effectively administered marketing channel cannot exist without an efficient flow of products through the channel members and to the target customers in the right quantities, at the right times and places. Physical distribution service standards refer to kinds and levels of service to be offered to channel members. A major managerial decision is to arrive at inventory standards offered to channel members at both wholesale and retail levels. In general, inventory control theory deals with the determination of optimal procedures for procuring stocks of modities to meet future demand. The objective is to minimize total inventory costs subject to demand and service constraints. The basic tradeoffs which must be measured are those associated with acceptable stock out risk and the risk derived holding and ordering inventories. A principal function of inventor is its ability to increase profitability through manufacturing and marketing support. The ideal concept of inventory would consist of manufacturing a product to the specifications of a customer after an order is placed. Such a system would not require stockpiles of raw materials or finished goods in anticipation of future sales. Though a zero inventory system is not generally feasible, each dollar invested in inventory should be mitted to achieve a specific objective. A safety stock is generally placed into the system to protect against unexpected delivery delays or greater than anticipated sales. Critical to the maintenance of adequate inventory service is a review procedure designed to evaluate, on a continuous basis, vendors, transportation suppliers, back orders, and damaged merchandise. A principal advantage of physical distribution system monitoring is its usefulness in identifying developing trends. Changes in customer preferences and changes due to petitive actions can also be identified by closely observing movement within the physical distribution system. By evaluating this information and relaying it to decision points within the firm, there can be more timely reaction to uncontrollable factors in the marketplace. Early recognition of these changing demands leads to improved customer service, defined as the interrelated package of activities provided by a supplier, which creates time and place utility for a buyer and ensures form utility . More recently, there has been a study of profit as a function of customer service. But, as mentioned above, physical distribution service has been a neglected aspect of marketing management. LaLonde and Zinszer included the following activities among those inventory factors most monly associated with customer service: product stock out level, channel munications, order cycle time, and variability of delivery time. The review of earlier research suggests improved physical distribution operations should lead to better customer service and profit may be increased by the manipulation of customer service variables. This, in turn, implies the JustInTime technique of inventory control is a method which should lead to better performance by marketing channels. It is generally acknowledged certain socalled wholesaling functions must be performed, whether by the m