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Industrial Real Estate Strategies To Increase Operating Profitability
(9/13/2005) Ascet Volume 7
By Johannson L. Yap, First Industrial Realty Trust, Inc.
Rene Circ, First Industrial Realty Trust, Inc.
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Corporations that have not considered their property holdings as a primary component of the supply chain configuration may not fully realize maximum real estate efficiency, flexibility and profitability.


 

In today’s globally competitive world, operating efficiency is the primary focus of the corporate cost-minimization/profit-maximization equation. Many manufactured goods are becoming commodities as new substitutes emerge. Further, increases in speed and reliability in transportation, domestically and especially globally, allow for freer geographic distribution of manufacturing and warehouse facilities. Since the Industrial Revolution, supply chain management has become increasingly prominent in corporate thinking. While companies no longer strive for the vertical integration used by monopolies such as Carnegie Steel, maximizing efficiency is still a growing concern. In fact, practitioners and academics write about a day in the not-so-distant future when competition among companies is decided not by the quality of their products or by their prices alone, but by the relative efficiency and effectiveness of each company’s supply chain.




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