Postponement is simply delaying a portion of the work that normally is performed in manufacturing until the product reaches the distribution center. An example occurs in electronics production, where voltages and plug prongs vary depending on whether the product is to be sold in the United States, Europe or another part of the world. Often, final electronic assembly is completed in the distribution center only after the destination market is determined.

McGraw Hill also postpones the kitting of educational books and science equipment until it reaches its distribution center in Ashland, Ohio. This used to be a service that had been outsourced before McGraw Hill brought it in-house to a new assembly area within the DC.

Inventory for the assembly operations at McGraw Hill is sorted to a shipping lane, just as if it were being gathered for a customer. Instead of being shipped, though, it is taken to the assembly stations where it is kitted and packed into display units, poster boxes and science kits. Anywhere from two to 200 items may be accumulated to create the new product.

Goodyear also practices a form of postponement in its facility that distributes bus tires. Before leaving the DC, a unique code is burned into the sidewall of each tire.

"This code ties that tire to a specific customer and the vehicle that it will eventually go on," explains Goodyear's Augustine.

The reason the code is so important has to do with the payment schedule for bus tires. Bus companies pay Goodyear based on the number of miles driven on each particular tire. Without the ability to track the tire's performance, Goodyear would not be paid properly.

New technology may soon be employed that could alter this process. Testing is now underway between automotive manufacturers and tire producers to place radio frequency identification (RFID) chips into tires for use in gathering road wear data and to make it easier to track tires when recalled.