IKEA

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2. Introduction

Companies are finding ways to improve its flexibility and competitiveness by changing its operation strategy, technologies that have implementation of Supply Chain Management (SCM) paradigm. For example, IKEA. It is the world’s largest home furnishing retailer having 298 stores in 37 countries with huge competitors around the world. However, it has a unique supply chain and inventory management techniques that makes it different and unique from others.

3. Section 1: Open ended discussion on IKEA

3.1 Suppliers
IKEA’s success is mainly to its communication and relationship with its suppliers. IKEA has more than 1800 suppliers in 50 countries and uses 42 trading service office to manage the supplier relationship. IKEA believe in having high quality product with minimum wastage and negative environmental impact. IKEA makes long term business relationship with its suppliers by …show more content…

For example, if someone select to buy a furniture. The furniture is ordered, shipped from the manufacturer then moved from the delivery truck to the warehouse. From the warehouse it is moved to the customer’s vehicle or delivered by the furniture retailer to the customer’s home. It costs money every time the product is moved, shipped and loaded. IKEA inventory is stocked at night after the opening hours. IKEA consider minimum setting that is minimum number of products available before reordering and maximum setting that is maximum number of products to order at one time. This process meets customer demand while minimising ordering too few or too many products and lowering cost of lost sales. Logistics managers know what is sold through point-of-sale (POS) data and how much inventory comes into the store through direct shipping and from distribution centres through warehouse management system data. IKEA believes its process and system allows for the right goods to be in the

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