In logistics, what contributes to low service intensity?

Prepare for the ESCP Real Estate (RE) Finance Test with engaging flashcards and multiple choice questions. Each question comes with comprehensive hints and explanations. Get exam-ready today!

The correct answer indicates that automated systems contribute to low service intensity in logistics. Automation in logistics encompasses the use of technology and machinery to perform tasks that were traditionally completed by human labor. When processes are automated, they generally operate with greater efficiency, speed, and reliability. This reduction in manual intervention allows for streamlined operations and helps lower the intensity of service required from staff.

In contrast, high transportation costs, frequent inventory turnover, and labor-intensive processes can all lead to increased service intensity. High transportation costs might compel companies to provide more responsive service to manage customer expectations despite cost challenges. Frequent inventory turnover might require more service engagement to restock and manage inventory levels effectively. Labor-intensive processes typically require more personnel involvement, which can heighten service intensity due to the need for increased coordination and management of physical labor tasks.

Thus, the implementation of automated systems reduces the reliance on labor, decreasing the overall intensity of service required in the logistics function, making it the most suitable answer.

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