Question

Which of the following help reduce the cost of physical handling in storing?

1) Automation
2) Inventory management
3) Optimization
4) All of the above

Answer 1

All of the above options, namely, automation, inventory management, and optimization help reduce the cost of physical handling in storing. Option 4 is correct.

Step-by-step explanation:

The aspects that help reduce the cost of physical handling in storing are:

Automation - Using machinery and robots to handle inventory reduces the need for manual labor, resulting in cost savings.

Inventory management - Efficiently managing inventory ensures that there's no overstocking and items are moved quickly, reducing costs associated with inventory holding.

Optimization - Streamlining operations and layout for storage to minimize time and effort in moving goods helps lower costs.

All of the above factors contribute to reducing the cost of physical handling in storage. By incorporating technology such as automation, applying strategic inventory management practices, and optimizing the storage setup, a company like Amazon has significantly reduced costs and improved efficiency, especially when compared to traditional bookstore models.

A shift towards more machines and less labor makes sense particularly when machine hours become cheaper relative to labor as in the example of adopting production technology 3, or shifting the opposite way when machine costs increase, such as when choosing production technology 2.