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What is Supply Chain Management and Why is it Important?

Sandeep Mittal 0

What is supply chain management?

Supply chain management is proactive with the raw material sourcing process and is required to deliver that product or service to the customer.

The function of SCM is to improve supply chain performance. It helps manufacturers to manufacture products on time and stick to requirements as much as the product can be sold. It helps supply chain systems and rough vendors to do more inventory work. Product shipping storage reduces product costs.

Components of SCM

  1. Planning
  2. Sourcing
  3. Making
  4. Delivering
  5. Returning
  6. Enabling

Planning- 

Enterprises need to plan and manage all the resources for the product and service to meet their customer demand, and the supply chain also needs to be improved. It can be determined from the supply chain to meet enterprise goals. Uses metrics and delivers true value to customers

Sourcing-

Companies must select their suppliers for essential goods so that the company can get the goods and services needed to make the product. After selecting the suppliers, the supply chain manager uses various processes to monitor the supplier’s relationships. Giving and taking inventory and supplier payment etc. processes are included.

Making-

The supply chain manager determines the time of manufacture of the product and accepts raw materials, quality checks as well as its delivery time with packaging to ship that product, to see more enterprises’ quality and labor productivity so as to meet quality standards to manufacture products.

Delivering-

This includes scheduling customer orders and their delivery time. Invoice and shipping of customers. It all depends on shipping the customer’s product. Some organizations outsource large portions of the delivery process to specialized organizations. Do, this process is followed mostly when the product needs special handling.

Returning-

The supplier needs a flexible network to get excess and unwanted products back from the buyer. It can be re-used in case of poor production and may even have to be dispersed if the product is undesirable.

Enabling-

The supply chain needs to be monitored in order to work efficiently and at the same time some procedures are required to assure compliance with the rules. It includes some processes like finance, HR, IT, facilities, product design, sales and quality etc.

Supply chain management examples

Looking at classic examples of the supply chain, Walmart and Procter & Gamble Companies, which started working together in the 1980s, and two of these companies started connecting the supply chain and when the seller and manufacturer started providing information and Later I saw Walmart and P&G making the cost a lot of work and this made other sellers more inclined for consideration and Walmart formalized the retail link and Cajolad for other retailers.

After some time, the Walmart POS system, every store from which the person used to collect the sales of P&G products, indicated that a particular product inventory had fallen to a limit as indicated by the POS. Walmart was informed to store more products and the P&G distribution center automatically alerted to ship the product.

Walmart determines P&G by the flow of constant information about how much product to produce and when, both firms realize the cost of work by avoiding over billing.

Why is supply chain management important?

If we see, the supply chain of manufacturers and retail was more strongly connected for the last few years. Timely replenishment orders from retail manufacturers to industry manufacturers as well as timely replenishment of retail shelves can be restored as further by-product sales have increased and more in line with chain partners and to improve company results Analytical tools to be used include these examples.

  • Identifying potential problems before they occur – When a customer demands more product from a manufacturer, the order is truncated by conventional feedback, which makes the customer feel insignificant and thus presents the manufacturer with a poor service before the buyer is disappointed. By doing this, he promotes any other product that makes the customer happy.
  • Optimizing price dynamically – Seasonal products that can be sold only on one season, then those products are sold as long as the season is end, then it has to be no kept for the next season, so those products are sold at a discount to empty the warehouse If it goes bad, the companies keep the prices according to the demand, but it is difficult for fashion products such as clothes where the supply is widely diverted. Prediction techniques can be used to improve margin.
  • Improving the allocation of available to promise inventory – Today, the equipment is very dynamic, allocating resources and scheduling work based on sales, forecasts, actual orders as well as raw material supply, the manufacturer is able to confirm the delivery date of the product as soon as the order is placed and incorrectly Orders work significantly

What is the extended supply chain?

This supply chain includes all companies, it contributes to the same product as well as customers and suppliers in this extended supply chain.

When companies face a supply chain problem, first of all I know about the supplier’s situation, rather the organization that oversees the supply chain has the option of reaching that company through a supplier before it. If the aluminum baseball bat is not available with the manufacturer, the store manager will contact the manufacturer with his response. The retailer will need to find the supplier when the retailer is monitoring the extended supply chain and if the store manager finds that the manufacturer has trouble getting the brim.

Summary

What is Supply Chain? If we see, the supply chain of manufacturers and retail was more strongly connected for the last few years. It can be determined from the supply chain to meet enterprise goals. The function of SCM is to improve supply chain performance. This supply chain includes all companies, it contributes to the same product as well as customers and suppliers in this extended supply chain. After selecting the suppliers, the supply chain manager uses various processes to monitor the supplier’s relationships. It helps supply chain systems and rough vendors to do more inventory work. Supply chain management is proactive with the raw material sourcing process and is required to deliver that product or service to the customer. Enabling- The supply chain needs to be monitored in order to work efficiently and at the same time some procedures are required to assure compliance with the rules.

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