What is one source of supply chain cost?

The source of supply chain cost can best be identified as the sum of the costs incurred and the costs delayed. This approach provides a comprehensive perspective on the financial implications of supply chain activities.

In a supply chain, there are various costs associated with the production and delivery of goods or services. "Costs incurred" refer to the immediate expenses that a company faces, such as raw materials, labor, transportation, and warehousing. On the other hand, "costs delayed" represent the potential losses or additional costs that a business may experience due to inefficiencies, such as stockouts, missed delivery deadlines, or spoilage.

By summing these costs, a supply chain manager can gain a full picture of the economic impact of supply chain operations. This helps in identifying areas for improvement, streamlining processes, and ultimately reducing the overall cost structure of the supply chain. Understanding both the immediate costs and those that arise due to unforeseen delays is crucial for effective supply chain management and making informed decisions.