Changing perspective from the manufacturer to the wholesaler or
distributor shows that there are other positive as well as negative
effects. Wholesalers and distributors have mainly built up an infrastructure
around full-sized Euro pallets (or the equivalent) so the
display unit A can be handled, but not as efficiently and conveniently
as a full-sized Euro pallet. On the other hand, the unit can reduce
single-package order picking if the order to the retail outlet equals the
volume of the display package, which gives increased customer value
and convenience to the wholesaler and retailer. In that sense the unit
will lower the handling cost. The system cost will be higher for the
wholesaler/distributor because of dual package types for the same
product. Sourcing and storing as well as system handling will be more
complicated, and the previous risk also appears here, where first-inlast-
out might occur. The capital tied up in stock will consequently be
higher. The display unit B will therefore generate a lower cost, considering
that only one type of packaging is used, and hence the higher cost
for more unit-order picking.