vadinho said:
Surely the optimum (if unachievable) system is that a good is produced so that it is available to a consumer at exactly the time required, and that no goods are produced that are not demanded?
While improved construction/production methods and technology are reducing the time taken, in-between the demand for and delay of a good being produced and handed over, I'm not sure every sector of an economy could ever achieve such instant gratification. Think of a reseller for instance, of urban street trends perhaps? The catalogues they receive are dictated by the labels and seasons. They do have some say in the matter of course, and will order in specific quantities, based on available store space, backroom storage, expectations of consumer demand, and various annualized sales statistics, in order to supply their store inventories.
But as we observe every year, not all of the goods will be sold, hence why you see 50% off stands, trying to get rid of old seasons clothing. So for this to work, most industries would require a store to be out the front of the production factory, which is inefficient if you think about space/land lease, costs
et al. It would probably be better to have multiple stores and one factory for instance, possibly even outsourced too. And this is depsite the fact that predicting individual consumer preferences will never be an exact science.
An important point I wish to make is that the market may not seem perfect, but the price adjustment process will often correct any supply and demand problems by itself. This is one area of economics that is greatly underestimated in my opinion. That is ‘prices also serve as signals’. It's like the market has its own self correction mechanism built in as an inherent feature. This can often become distorted though by government interference in the economy.
vadinho said:
BTW things like "print on demand" are close to perfection...
Good example, another one that comes to mind is getting a key cut. But despite such examples, there is still technology and parts involved in the production process, especially certain materials, which will not always be in use and will hence need to be stockpiled, ready for when the customer walks in. There will even be intervals where such equipment may remain idle for some time, before a customer does request the applicable good or service.
I have to say, I have always been pessimistic that society could achieve such an optimum level theorized. Imperfect information and all that jazz.