The concept of postponement advocates that commitment, as to the form and place of commodities, can be delayed to the latest possible point in the supply chain (Bowersox and Morash 1989). Although this concept was first proposed in the early 1950s (Alderson 1950; Bucklin 1965), increased application and interest have been noted only recently (e.g., Closs et al. 1998; Feitzinger and Lee 1997; Pagh and Cooper 1998; van Hoek, Commandeur, and Vos 1998). This is reflective of the move toward customization and recognition of inventory risks and logistics costs for firms.

Zinn and Bowersox (1988) examined the benefits of implementing form postponement strategies in place of the traditional anticipatory distribution strategy. Their simulation results, based on a normative cost model, suggest that form postponement strategies can reduce the direct cost of production under many circumstances, However, the optimal postponement strategy under each circumstance may be different. Product and demand characteristics will influence the cost function and thus the optimal choice of strategy or mixture of strategies (Bowersox and Morash 1989; Closs et al. 1998; Feitzinger and Lee 1997; Pagh and Cooper 1998; van Hoek, Commandeur, and Vos 1998). For example, Zinn and Bowersox find that products marketed under different brand names benefit from labeling postponement. In contrast, products sold in various configurations benefit from assembly postponement.