Why supply chain management is so important

The goal of any commercial operation is to get a particular product from its point of origin to final destination with the minimum of cost while achieving maximum profit. The success of this process is all about effective supply chain management, and the strategies that are in place. Supply chain management deals with the direct coordination of internal processes, such as

production, logistics, stock control, storage, transportation, finance, purchasing and marketing. Getting the most from every stage of an operation is key to the smooth running and overall cost effectiveness of a business.

A good supply chain management strategy will firstly look at the flow of internal processes and understand how to maximise resources, identifying possible problems before they occur. It will consider the impact of stock inventory on working capital, or bulk purchasing and the effect on cash flow. A look at the organisation of internal storage, getting the most practical arrangement of sortation tables and packing stations can improve efficiency. Whether the operation is a clothes shop, distribution centre, a supermarket or e-commerce, the importance of supply chain management cannot be underestimated, especially in today’s competitive market.

The benefits to businesses can make the difference between success and failure, and putting an effective system in place is crucial to keep costs down and increase profit margins. Today, the consumer expects a whole lot more, and with competition keen it certainly pays to take a good look at how efficient and co-ordinated your operation really is.

Posted by Katrina
4th April 2018
General

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