What is a supply chain ? Supply chain is a process that includes activities that like movement of goods, services, information and money from the manufacturer to the consumer. The increased competition and the large variety of products that have been introduced have forced the companies to look into their supply chain processes. This is a byproduct of the era of Globalization. Supply chain is made of processes like procurement from suppliers of raw material from the suppliers which are then sent to manufacturing plants to be processed. The goods generated after processing can be finished or semi finished. These goods are then sent to the warehouse for intermediate storage and then sent to distributors , retailers and customers A supply chain can also be called a “Value Chain” as entities add value to the product at each stage of the supply chain whereby increasing the appeal in the eyes of the end customers leading to a purchase, Supply chain is not just a flow of goods and services but also includes the flow of information and money. The flow is a bidirectional flow which encompasses flow of information from supplier to consumer and consumer to supplier in the form of feedback. This flow of information and money should be taken seriously because at the end of the day customer satisfaction is the key element for any firm to be profitable. A typical supply chain may involve a variety of stages. These supply chain stages include: • Raw Material Suppliers • Manufacturers • Wholesalers/Distributors • Retailers • End Consumers The traditional outlook of supply chain management only focused on delivery f goods to the customer at the cheapest price possible but the definitions of supply chain has been altered over time.The new supp... ... middle of paper ... ...he customer is a part of delivery mechanism. Free On Board- It is the strategy of Factory Pricing where the buyer bears the shipping cost. Freight Absorption Pricing – It is the strategy in which the parts of transportation costs which are in line with the competitors are paid. Uniformed Delivery Pricing- It is the strategy in which a standard price is set for all the shipments irrespective of the location. Zone Pricing – It is the pricing strategy in which different price is charged for different prices for different zones i.e. geographical locations. 5. Return Merchandise Authorization – This process is commonly referred to as “Returns”. It is the authorization system that is responsible for receiving the defective goods and excess goods back from the customer. It is also a scheme to support customers who may be facing problems with the delivered products.
...tbound Logistics: The outbound logistics include the movement of the finished goods from the manufacture to the retail stores or a warehousing facility for later use.
A supply chain consists of all operations involved in a company from production, distribution, to final delivery of an output to consumers. However, the supply chain of goods differs from that of services in many perspectives. Therefore, the commodity analogy is inappropriate for services industry.
The value chain analysis can be examined as to whether they provide opportunities for differentiation or cost reduction. According to Porter, the value chain model is a useful analysis tool for defining a firm's core competencies and the activities in which it can pursue a competitive advantage by following one of the two strategies:
· Price importance all companies (especially large, automakers) want to reduce cost of delivery to customer
Cost-plus pricing, it the industry pricing standard, and is a method to determine a price of the product by finding the cost per unit and then including a mark-up
A supply chain is a system through which organizations deliver their products and services to their customers. The network begins with the basic ingredients to start the chain of supply, which are the suppliers that supply raw materials, ingredients, and so on. From there, it will transfer the supplies to the manufacturer who builds, assembles, converts, or furnishes a product. The chain now needs to get the product to the consumer by transporting the finished product from the manufacturer through a warehouse or distribution center. An example is that Wal-Mart has a nearby distribution center where products are delivered there and then split up to be delivered to a retail Wal-Mart. “Wal-Mart will take responsibility for breaking down larger loads and delivering the product to other Wal-Mart stores” (Ehring 1).
• Revenue and expense recognition for freight services in processes. • Revenue and expenses are contractually established as it relates, for example reimbursements of obsolete parts in which the customer will reimburse the company at 50% of cost per this case study. • The accounting of shipping and handling fees of cost. As stated in the contract, when spare parts are purchased by the company the vendor ships the spare parts directly to the customers warehouse. However, the customer does not take ownership until a purchase order is
- The pricing strategy is a way to recoup initial investments, competition with other companies, and the factor that volume will bring down production costs. A company may also look at the benefits to earn profits on their goods when looking at their pricing. A good example of this is my teacher Dr. Fishbeck and his IT consulting business. He offers very low rates due to his competition having better benefits with their size and customer
In a traditional manufacturing company, the supply chain covers the following roles: suppliers, labour, engineering, production, product, quality assurance, inventory, competitors and customers. The last role, that of customers, is different from the rest of the roles within a classic supply chain, meaning that suppliers are oriented upstream, while customers downstream; the labour is situated internally, while customers are external; engineering is done only by qualified engineers; production is protected from customers; products represent the offering that the customers obtain; quality assurance prevents faulty products to get to the customers; inventory can be managed in order to saturate the demand in time; and finally competitors offer customers different choices to satisfy their needs. Taking separately, the customer role in the traditional supply chain often resumes at “selecting, paying for, and using the outputs” and sometimes proving feed-back and promoting a company’s offerings by recommending to others (Sampson and Spring,
“Supply chain. Product life cycle processes comprising physical, information, financial and knowledge flow or movements whose purpose is to satisfy end-user requirements with physical products and intangible services from multiple, linked suppliers.” In other words, supply chains compose a network of different companies that cooperate closely for goods delivery.
Supply chain management is basically refers to the fundamental supply chain analysis of the organization which predominantly describes functionalities from source to the delivery point. In this process of delivery, supply chain management framework divides in four categories: In Planning the products and suppliers evaluated and selected, Sourcing pull the information process including contracting, ordering and expediting, Moving is a physical process from suppliers to end user and Paying is the financial process including payment and performance measurement.
‘Supply chain management integrates supply and demand management within and across companies. It encompasses the planning and management of all activities involved in sourcing and procurement, conversion, and all logistics management activities. Importantly, it also includes coordination and collaboration with channel partners, which can be suppliers, intermediaries, thir- party service providers, and customers’. (Web: Council for Supply Chain Management Pr...
Supply chain management has been defined as that process that involves the management of information, materials, and all the finances that are handled within and across the entire supply chain process (Christopher, 2016). The management is usually done through out the entire supply chain management from that moment when the suppliers are involved through all the manufacturing activities, different distribution activities, and the way that the products are served to the final product consumer (Turban, et al., 2002). The process also includes all the activities that different organizations offers to their customers as after sale services for purposes perfecting their services and products towards their highly valued customers (Christopher,
"A lot of companies think of supply chain as a cost centre. They don’t always see it as helping to funnel top-line growth." Supply chain touches practically every part of operations inside an organization: from determining client interest, to sourcing crude materials, to assembling, distribution and returns Supply chain is to adjust supply and request, for example the demand for goods and services. You need to get the right quantity and quality of goods and services
Today’s organizations are faced with increasing levels of global competition, customer’s demanding value for their money and high stakeholders expectations on investment returns. Gattorna (2003), notes that firms are now pursuing supply chain management as a strategy to competitive advantage. Firms in a supply chain relate, transact, and partner on different levels; from product design and development to product delivery. Through supply chain management a firm pursues value creation through timely product delivery, cost management, inventory control and customer service (Beamon, 1999).They do so individually or through synergies formed with other organizations to increase customer service