Posted in Operations and Supply Chain Terms, Total Reads: 566
Definition: Intermediate Destination
Intermediate destinations is a stopping or exchanging point, before the shipment is delivered to its final destination. These intermediate destinations act as the facilitation centres between the source and the destination, influencing the distribution strategies of operations. Intermediate destinations hold significant importance and are more frequently used in the Transhipment model in operations management.
Transhipment is referred to as the delivery of containers or goods to intermediate locations and then to the final destination. For a transportation model, which ensures a direct supply from the supply point to the demand point, transhipment model includes a transhipment which acts as an intermediate destination in addition to the supply and demand point.
The supply point has the ability to send goods to other points but cannot receive goods from other points, whereas the demand point has the ability to receive goods but cannot supply goods to other points. But, the transhipment point has the ability to both send and receive goods. There are a number of reasons for having intermediate destinations, some of these are:
• To shift to another mode of transportation during the journey
• To consolidate small shipments into large shipments