The potential for operating cost reduction through logistics and chain management is considerable. Because a large proportion of costs in a typical business are driven by logistics decisions and the quality of supply chain relationships, it is not surprising that in the search for enhanced margins many companies are taking a new look at the way they manage the supply chain. It is not just the transportation, storage,handling and order processing costs within the business that need to be considered. Rather pipeline view of costs on a true'end-to-end' basis should be taken. Often the upstream logistics costs can represent a significant proportion of total supply chain costs embedded in the final product