Glossary
Milk run
Tags: Glossary
Delivery method for mixed loads from different suppliers: Instead of each of several (say, 5) suppliers sending a vehicle every week to meet the weekly needs of a customer, one vehicle visits each supplier on a daily basis and picks up deliveries for that customer. This way, while still five vehicle loads are shipped every week, each vehicle load delivers the full daily requirements of the customer from each supplier. This method gets its name from the dairy industry practice where one tanker collects milk every day from several dairy farmers for delivery to a milk processing firm. Also see Consolidation.
What is Milk run?
A milk run is a delivery method used to transport mixed loads from different suppliers to a customer. Instead of each supplier sending a separate vehicle every week to meet the customer's weekly needs, a single vehicle visits each supplier on a daily basis to pick up deliveries for that customer. This method is efficient because it allows for the consolidation of multiple deliveries into one vehicle load.
Let's imagine a scenario where a customer needs supplies from five different suppliers every week. Traditionally, each supplier would send their own vehicle to deliver their products to the customer. This would result in five separate vehicle loads being shipped every week.
However, with the milk run method, one vehicle is designated to visit each supplier on a daily basis. This vehicle picks up the deliveries from each supplier and transports them to the customer. By doing so, the customer's daily requirements from each supplier are fulfilled in one vehicle load.
The term "milk run" originates from the dairy industry, where this practice is commonly used. In the dairy industry, a tanker collects milk every day from several dairy farmers and delivers it to a milk processing firm. This ensures that the milk is collected and transported efficiently, reducing the number of vehicles needed for transportation.
The milk run method offers several advantages. Firstly, it reduces the number of vehicles on the road, leading to cost savings and a decrease in traffic congestion. Secondly, it improves delivery efficiency by consolidating multiple deliveries into one vehicle load. This reduces the time and effort required for delivery coordination.
Additionally, the milk run method promotes better inventory management. By having a daily delivery schedule, suppliers can plan their production and stock levels more effectively. This helps to minimize stockouts and ensures that the customer's needs are consistently met.
In conclusion, a milk run is a delivery method that optimizes the transportation of mixed loads from different suppliers to a customer. By consolidating deliveries into one vehicle load, it improves efficiency, reduces costs, and enhances inventory management. This method, derived from the dairy industry, is widely used in logistics to streamline the delivery process.