CandleFocus Glossary Editor
A supply chain is an integral part of the business world - extending far beyond the traditional "make and sell" concept to encompass a complex, dynamic network of suppliers, producers, manufacturers, delivery companies and retailers, as well as countless other stakeholders involved in the delivery of products and services to the end consumer.
At its core, a supply chain consists of all the steps associated with creating and delivering a product or service from the raw material stage all the way to the customer’s hands. Producing the physical goods, dealing with parts suppliers, managing inventory and controlling quality, tracking sales, developing marketing strategies, and then efficiently distributing and delivering the product are all critical elements within a supply chain.
Having an effective supply chain is essential for success in today’s competitive business environment. It’s important to be able to keep costs low and to quickly adapt to changing customer tastes. Companies that have adopted efficient supply chain strategies are able to stay ahead of the competition by keeping production costs down, offering more competitive prices, and delivering products faster and with better quality.
The concept of supply chain covers the entire spectrum of activities necessary to move goods or services from origin to destination. Supply chain management (SCM) is a management system that performs the sourcing of components and materials, the production and assembly of products, the transport, handling and storage of goods, along with tracking and reporting necessary for efficient and effective decision-making. The end goal is to ensure that the goods are delivered to the customer at the right time, in the right place, and in the right quantity with the expected quality and at the lowest possible cost.
The key components of SCM include demand planning, supplier relations, inventory management, logistics, and customer service. Demand planning covers the forecasting and tracking of the demand for the goods or services being supplied. Supplier relations involves the identification, selection, and partnering of organizations that provide goods and services to the company. Inventory management includes responsible stock and goods management, ensuring that the goods are being stored properly and are of the right quality. Logistics covers the transport, movement and related activities necessary to move the goods from the suppliers to the customers. Customer service completes the process and requires that the goods reach the customers without fail and of satisfactory quality.
Supply chain management is becoming increasingly important in modern-day businesses. By utilizing an effective supply chain strategy, companies can reduce costs, improve customer satisfaction, and increase profits. It is vital that companies have the right systems and processes in place in order to capitalise on the intricate networks of suppliers, logistics providers, and customers that are essential for success.
Having an effective supply chain is essential for success in today’s competitive business environment. It’s important to be able to keep costs low and to quickly adapt to changing customer tastes. Companies that have adopted efficient supply chain strategies are able to stay ahead of the competition by keeping production costs down, offering more competitive prices, and delivering products faster and with better quality.
The concept of supply chain covers the entire spectrum of activities necessary to move goods or services from origin to destination. Supply chain management (SCM) is a management system that performs the sourcing of components and materials, the production and assembly of products, the transport, handling and storage of goods, along with tracking and reporting necessary for efficient and effective decision-making. The end goal is to ensure that the goods are delivered to the customer at the right time, in the right place, and in the right quantity with the expected quality and at the lowest possible cost.
The key components of SCM include demand planning, supplier relations, inventory management, logistics, and customer service. Demand planning covers the forecasting and tracking of the demand for the goods or services being supplied. Supplier relations involves the identification, selection, and partnering of organizations that provide goods and services to the company. Inventory management includes responsible stock and goods management, ensuring that the goods are being stored properly and are of the right quality. Logistics covers the transport, movement and related activities necessary to move the goods from the suppliers to the customers. Customer service completes the process and requires that the goods reach the customers without fail and of satisfactory quality.
Supply chain management is becoming increasingly important in modern-day businesses. By utilizing an effective supply chain strategy, companies can reduce costs, improve customer satisfaction, and increase profits. It is vital that companies have the right systems and processes in place in order to capitalise on the intricate networks of suppliers, logistics providers, and customers that are essential for success.