Activity associated with movement of material (FG or parts) from the mfg to customer; encompass transportation, warehousing, inventory control, material handling, order administration, site & location analysis, industrial packaging, data processing, and communications necessary for effective mgmt; includes all activities related to physical distribution, as well as return of goods to mfg; systematic division of a whole into discrete parts with different characteristics.

• A. Demand management
• B. Distribution
• C. Demonstrated capacity
• D. Demurrage

Answer: (B)

Physical distribution is what this item is describing. It covers the movement of finished goods or parts from manufacturing to the customer and includes everything that supports that flow: transportation, warehousing, inventory control, material handling, order administration, site and location analysis, packaging, data processing, and the communications needed to manage the process. It also encompasses the return of goods to the manufacturer. In short, it’s the integrated set of activities that plan, execute, and control the physical movement and storage of goods and related information.

Other terms don’t fit this broad scope. Demand management focuses on forecasting and influencing demand; demonstrated capacity is a measure of capacity, not the distribution system itself; demurrage refers to charges for delays in transit.