Physical distribution costs in construction supply chains: a systems approach

The objective of this study is to provide insights into the trade-offs of physical distribution cost patterns in construction supply chains by modelling and measuring these costs. The model of the physical distribution system consists of the following (cost) elements: inventory, transport, handling, and warehousing. It is applied in the supply chain of insulation materials. It is concluded that the model gives a valid explanation for the major cost trade-offs in the supply chain analysed. By using this model, firms involved in the physical distribution of building materials in construction supply chains may find the optimal distribution strategy.