Milk Run, a race between “Time” and “Goods”

Afternoon rains are perfect for sipping coffee, but what if you have a weird mind and you begin to think what goes into making this sublime drink and how do these things find their way into your pantry. With rain drops pattering the window pane and my mind randomly fixated on milk, I read a term “Milk Run” abruptly written at the back of my notebook. With a curious and a hungry mind, I began researching on milk run and how it could be connected to my coffee.
The first few results that I got though disappointed my taste buds but invoked my curiosity for Inventory Management System. Milk Run by definition is:
A Milk Run, in logistics, is a round trip that facilitates either distribution or collection.
The definition cannot get any simpler than that, but it does hide minute details, which aren’t clear and those are the very details I will share in this blog. Milk Run is a logistic management technique, which is extensively used in manufacturing industries around the globe. The name Milk Run was coined way back in 1900's, in United States the milk man would come every morning with filled milk bottles and would replace the empty bottles with the filled one. The aim was to replace the stock so that it lasts until the next milk run. This system insured the efficient use of transport, as in the same run the empty bottles were picked up and the filled bottles were delivered to different households.

Another example of Milk Run being used in literal sense is in Etymology, the smaller dairy farms in villages used to produce milk for a larger dairy to use, but due to their small revenues, they were not capable enough to have their own transportation system. To cater to this problem, a single truck was used to collect the milk from all these smaller dairies in a single run and then finally reach the bigger dairy with a filled milk container. This resulted in an efficient use of the transport and hence in better profits for both the dairies.

The Milk Run logistic system is different from the age old Hub and Spoke Model for logistic circulation, but it wouldn’t be right to say that it is better in any way.
Hub and Spoke Model: The spoke-hub distribution model or network is a system of connections arranged like a wire wheel in which all traffic moves along spokes connected to the hub at the center, also called point to point transfer system.
What choice of inventory management system should be used?
Well the answer totally depends on the number/quantity of the material to be supplied or collected from a certain location. Milk Run is increasingly beneficial at areas where there is a sparse demand and a single unit of transport can accommodate the logistic demand of certain number of locations. Beyond a certain number, Hub and Spoke model is the clear cut choice as it becomes more cost efficient, faster and easier mode of logistic circulation.
There are certain other use cases and benefits of the Milk Run technique:
- Higher yield ratio from each transport, which leads to a reduction in logistic cost
- eduction in pollution, as number of trucks used will be less in number; this would lead to a cleaner environment and lower pollution emissions.
- JIT (Just in Time) will be followed. JIT is another logistic management tool, which is used to reduce the amount of inventory at a place and hence leads to lesser accumulation of goods. In each run, only the required amount of goods, which would last till the next milk run are delivered at the location. This also leads to faster movement of goods and 100% utilization of transports.

There are many other ways of inventory management system which are present in the industry and have significantly increased the yield and the profits of manufacturers. One of the examples of this is, Last Mile Algorithm; this is used to plan efficiently the last mile for goods delivery and get a shortest and the most optimum route for product delivery. This is extensively used by e-commerce delivery system and has decreased their home delivery cost by a large margin.
I would love to hear your take on Milk Run and how different techniques have made logistics easier and more convenient. Till then keep reading and supporting. Cheers!

