Supply chain management is the process of optimizing the entire production flow of consumer durables, products & much more — beginning with the raw elements all of the way to delivering the last product to the customer. An organization creates a network of suppliers that move the product along from the suppliers of raw materials to those organizations that deal straight with users.

Process of Supply Chain Management

Supply chain management is a procedure utilized by companies to make sure that their supply chain is efficient and cost-effective. A supply chain is the assortment of steps that an organization takes to change raw materials into a final product. The five basic aspects of supply chain management are discussed below −

Demand Planning

Supply chain planning starts with demand planning, a process for gathering historical data, such as past sales, and applying analytics and statistical modelling to generate a forecast.

Production Planning

In the next major step, production planning is the organization nails down the specifics of where and exactly how the products called for within the demand plan will soon be manufactured.

Material Requirement Planning

Most manufacturers use to ensure sufficient materials and components, such as subassemblies, are available for use in the manufacturing process by taking inventory of what's on hand, identifying gaps, and purchasing or making the rest of the items. 

Inventory Management

Manufacturers are faced with many different inventory management issues, many of which involve coordinating demand planning with all the inventory at both ends regarding the production process, so inventory planning is done to resolve this issue.

Procurement

Procurement is the process of finding suppliers for goods, managing those relationships, and acquiring the goods economically - along with all the communication, such as sending out requests for bids, and paperwork, including purchase orders and invoices. 

Logistics

It covers the transporting and storing of goods, from the delivery of parts and raw materials to manufacturers of processors to the delivery of finished products to stores or direct to consumers, and also beyond for product servicing, return, and recycling.

Importance of Supply Chain Management

Identifying potential problems

When a client orders more products than the manufacturer can deliver, the customer can complain of poor service. Through data analysis, manufacturers might be able to anticipate the shortage before the buyer is disappointed.

Optimizing price dynamically

Seasonal products have a small shelf life. At the end of the season, these items are generally scrapped or sold at deep discounts. By utilizing analytic software, similar forecasting techniques can improve margins, even for hard goods.

Improving the allocation of “available to promise” inventory

Analytical software tools make it possible to dynamically allocate resources and schedule work based on the sales forecast, actual orders, and promised delivery of raw materials. Manufacturers can confirm an item delivery date once the order is positioned — significantly reducing incorrectly-filled orders.

Conclusion

With 13SQFT.COM Services, you can evolve your supply chain processes into intelligent workflows, to reach new levels of responsiveness and innovation. 

Challenge siloed processes to discover efficiencies, enable your teams to execute and deliver and make use of emerging technologies like AI and blockchain to unlock opportunities in almost every step of the value chain — from demand planning to order orchestration and fulfilment.