Supply Chain Management
Supply Chain Management
To have a better Understanding on the term supply Chain management, we can divide the term into two different parts. Supply Chain and Management.
What is Supply chain?
A supply chain is a system of organizations, people, activities, information, and resources involved in moving a product or service from supplier to customer. Supply chain activities transform natural resources, raw materials, and components into a finished product that is delivered to the end customer.
What is Management?
If simply put in, management is the process of planning, Organising, Directing and controlling the activities of organisation for achieving the desired goals within the stipulated time. It is the process of coordinating the different resources for a certain objective.
Supply Chain management
Now, can you explain the term Supply Chain Management? Yes, it is the process of managing the Supply Chain or flow of goods. It includes the process of Planning, Organising and Controlling the movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption.
Components of Supply Chain industry
Supply chain management is formed by different verticals such as, Logistics Management, Warehousing, Transportation, Inventory management, Custom clearance, Cold chain, Freight forwarding, E-Commerce, Port Operations, Ancillary services.
“Logistics management is that part of supply chain management that plans, implements, and controls the efficient, effective forward and reverse flow and storage of goods, services and related information between the point of origin and the point of consumption in order to meet customers’ requirements.
The process of integrating the moving and maintenance of goods in and out the organization is logistics. In general point of view it means having the right thing at the right place and at the right time.
A warehouse is defined as a large building where raw materials or finished goods are stored prior to their distribution for sale. The performance of administrative and physical functions related to the storage of goods is warehousing.
Transportation is the ‘The Backbone of logistics’. Transportation is considered as Safe, efficient, reliable, and sustainable movement of persons and goods over time and space.
Role of transportation in logistics
Transportation plays a connective role among the several steps that result in the conversion of resources into useful goods. Transportation ensures movement of goods, minimizes cost and ensures customer satisfaction.
-Adding value to the product by providing time and place utility.
-Enables the efficiency of goods movement
-Provide better logistics efficiency, reduce operation cost, and promote service quality.
-Increase the competitiveness of logistics firms
-Physical link between suppliers and customers
Modes of transportation
Modes of transportation used in logistics can be classified into Inland, Air, Water and Pipeline
Inland transportation can be transported using two modes Road & Rail. Aircraft is used for air transportation. Ships, Boats, Canoes are used in Water transportation and generally call it as shipping logistics. Pipeline is used for transporting petroleum products.
Inventory management involves the control of assets being produced for the purpose of sale in the normal course of company’s operations. The goal of effective inventory management is to minimize the cost associated with holding inventories. This is the process of efficiently overseeing the constant flow of units into and out of an existing inventory. The major activities involved in inventory management are: Product inventory, Product purchase, Product sales, Supplies & managers, Employees (sales), Account manager, Product expiration and Inventory status reports.
Customs clearance involves preparation and submission of documentations required to facilitate export or imports of goods between two countries, representing client during customs examination, assessment, payment of duty and co-taking delivery of cargo from customs after clearance along with documents.
Cold chain is a part of logistics in which climate controlled supply chain containing of storage and distribution activities which maintain a product at a given ambient range. It also involves the transportation of temperature sensitive products.
Freight forwarding & freight forwarder
Freight forwarding is the coordination and shipment of goods from one place to another via a single or multiple carriers via air, marine, rail or road.
Freight forwarder is a commission agent performing on behalf of the exporter and importer routine tasks such as loading /unloading of goods, storage of goods, arranging local transport and obtaining payment for his customer.
Electronic Commerce, commonly known as E-commerce, is trading in products or services using computer networks, such as the Internet. Electronic commerce or e-commerce refers to a wide range of online business activities for products and services.
Types of E-Commerce
E-commerce companies can be classified into several categories. We can name them as Business-to-business (B2B), Business-to-Customer(B2C), Customer-to-Business(C2B), Customer-to-Customer(C2C), Business-to-Government(B2G) and M-Commerce
Flipkart.com, snapdeal.com, Quickr.com, Olx.com, etc. are some of the important e-commerce companies in India.
Port Operations are also major components of Supply Chain Management which includes, shipping, import and export operations, loading and unloading for international logistics. Port operations are mainly involved in shipping logistics.
Ancillary industries are those industries which provide the art and particles for other industries. Ancillary services in supply chain management operations means services necessary to support logistics operations. Some of the ancillary services are Logistics IT providers, Logistics Tools and Machine operators, providers of Pallet trucks and other loading equipments, Container depots, Packers and Movers, Custom House Agents and the like.