Merge-in-transit is a supply chain flow strategy made famous by Dell Computer. The basic merge-in-transit concept is to use the transportation function (vs. warehousing) to assemble the components of an order manufactured on demand in disparate locations.
Example Merge-in-Transit Flow
This logistics strategy at one time allowed Dell to achieve return on invested capital rates in excess of two times their closest competition. Some of the keys to success for them included:
- Direct internet sales
- Supplier owned inventory held less than 15 minutes away
- Supplier City with vendors on-site performing inventory management on Dell’s behalf
- The merge-in-transit flow concept