Supply chain management is a central component of every business chain, which involves delivering the right goods to the right person, at the right time. Even though this might sound as an easy task, when considered at a small level, it is actually a complex multi-step process, which requires perfection and strategy at each stage. The basic objective of any supply chain is to synchronize supply with demand, along with focusing on net value. The importance of supply chain management can be understood by taking into account the different functions performed by this component of the business chain. These function are as follows:
For more details about supply chain management, visit Mclane Logistics Technology located at 4001 Central Pointe, Parkway, Temple , TX 76504. You can also call them at 1-800-989-7568.
- Configuration of the business network- This includes ascertaining the number and location of different people involved throughout the process. It starts from the suppliers and producers, extending to the distributers, warehouse managers, and finally the consumers.
- Devising a strategy for distribution- This step includes various stages, which start from determining whether the operating control shall be centralized, decentralized, or shared. The next step is analyzing the best mode for delivery. Direct shipment is a practical option for most businesses. Others include cross docking, pool point shipping, and direct store delivery. The supply chain management also needs to determine the best mode of transportation to suit the company’s needs as well as budget.
- Proper coordination for low logistics cost- It is the duty of the SCM to ensure that all the above mentioned processes are carried out at the lowest possible cost. The key in this step is trade-offs, which are vital for optimizing logistics costs. Making choices like Full Truckload versus Low Than Truckload shipments, is the role of the SCM, and can have a significant effect on the end-process net cost.
- Effective inter-process communication- Considering the various entities involved in the complete process, it is essential to have a binding link between each process. This role is played by the SCM. All potential collaboration is taken care of, and vital information about factors like demand signals, transportation, and forecasts, is effectively communicated to the concerned persons. Timely cash flow throughout the process is also taken care of by the SCM.
- Inventory management- The final, yet probably most important role of the SCM is managing the inventory. With the inventory not in order, none of the aforementioned processes can be carried out smoothly.
For more details about supply chain management, visit Mclane Logistics Technology located at 4001 Central Pointe, Parkway, Temple , TX 76504. You can also call them at 1-800-989-7568.
