The Product Analogy Of A Supply Chain Case Study

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The reason why the products analogy of a supply chain is not appropriate for services 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. Firstly, the service supply chain requires low capital investment in equipment and machinery. In comparison, both the manufacturing and the service industries need labor inputs to complete the production processes that are necessary for satisfaction of end consumer utilities (Maxwell 2013). In addition, the businesses in both sectors require various types of inputs from their suppliers. Moreover, capital investments in material are required in both businesses to enable employee render their services. However, most of the labor costs in manufacturing firms are involved in transporting, procuring, and physical material manipulation. On the other hand, labor costs in the service industry are a...

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