Business Degree Certification Practice Test

What is the term for a system that enables products to be delivered continually without sitting in inventory?

1. Postponement

2. Cross-docking

3. Continuous replenishment

4. Direct-response delivery

The correct answer is: Cross-docking

The term that most accurately describes a system enabling products to be delivered continually without being held in inventory is continuous replenishment. This approach emphasizes a seamless flow of goods from suppliers to retailers or consumers, minimizing the time products spend in storage. Continuous replenishment systems rely heavily on demand forecasting and real-time data to ensure that inventory levels are optimally maintained, allowing businesses to respond swiftly to consumer demand without overstocking. Postponement refers to delaying the final production or assembly of a product until customer demand is better understood, which does not specifically address the continual delivery aspect. Cross-docking involves the direct transfer of products from inbound to outbound docks without long-term storage but does not inherently focus on replenishment in response to demand. Direct-response delivery generally pertains to logistics that respond quickly to specific consumer requests, rather than a systematic approach for ongoing product flow.