4 ms·

Mandating a lower-than-maximum container stacking height was itself a buffer, which is now being filled by temporarily stacking higher. The idea that we run wi

Mandating a lower-than-maximum container stacking height was itself a buffer, which is now being filled by temporarily stacking higher. The idea that we run without buffers in the supply chain is contradicted by his own big idea to use one of them. We don’t have big warehouses full of inventory sitting around like we used to, true. But we do have the money we generated by running more efficient supply chains, and money is more flexible than outdated inventory. Edit to add: whether that money is sitting with founders, shareholders, or employees is largely irrelevant from a macro perspective.

ARandumGuy 5y ago
Money doesn't do you much good if you can't actually spend it on anything. Getting rid of warehouses full of car parts to save some cash doesn't do a lot of good when no one can sell you car parts for any price. Buffers won't solve a long term shortage, but they can prevent a short term shortage from cascading. When the entire global economy is running with minimal buffers, then the effects of supply disruptions can last years, and that problem can't just go away by throwing money at it.