Some of the challenges facing the manufacturing industries in today’s business due to the increase in global competition is how to consistently meet with customers’ requirements and demands at the lowest possible cost and to remain competitive in the market. In order to achieve this goal, an effective and efficient supply chain management is the main focus. These have caused corporations to control their costs more than ever while simultaneously optimizing the production processes, facility locations and distribution operations by the supply chain management and at the same time paying more attentions to their customers’ needs.
“A supply chain is a network of facilities (e.g. manufacturing plants, distribution centers, warehouses, etc.) that performs a set of operations ranging from the acquisition of raw materials, the transformation of these materials into intermediate and finished products, to the distribution of the finished goods to the customers”(Melo et al, 2003).
Bhaskaran and Leung, described the manufacturing supply chain as an integrative approach for managing the flow of information and products between manufactures, suppliers, retailers and the customers. A typical supply chain comprises suppliers, production sites, storage facilities, and customers. It involves two basic processes tightly integrated with each other: (i) the production planning and inventory control process, which deals with manufacturing, storage, and their interfaces, and (ii) the distribution and logistics process, which determines how products are retrieved and transported from the warehouse or distribution centers to retailers.
The above tasks involve both strategic and operational decisions, with time horizons ranging from several years down to...
... middle of paper ...
...and at that destination, some of these companies have depots or distribution centers they control within a particular region. So in order to distribute the actual quantity of products to be allocated to these depots and then to the demand points so that customers at every region are satisfied with the availability of their products at minimal distribution cost, therefore companies are concerned with the optimal placement of their plants, distribution centers, warehouses and so in order to minimize the costs of transportation and cost of opening the facilities.
For the reason above, this work seeks to answer the following;
• Where are the optimal locations for the facilities based on customer demand?
• Which DC’s should serve each customer?
• How will the number of distribution centers impact total costs?
• How will the cost of transportation impact the total costs?
The purpose of supply chain is to improve overall performance of a business. Whether organisation is functioning national or worldwide the competition is always increasing and offering products at the lowest possible cost with the best possible customer service is a way to ensure market share.
A supply chain is a system through which organizations deliver their products and services to their customers. The network begins with the basic ingredients to start the chain of supply, which are the suppliers that supply raw materials, ingredients, and so on. From there, it will transfer the supplies to the manufacturer who builds, assembles, converts, or furnishes a product. The chain now needs to get the product to the consumer by transporting the finished product from the manufacturer through a warehouse or distribution center. An example is that Wal-Mart has a nearby distribution center where products are delivered there and then split up to be delivered to a retail Wal-Mart. “Wal-Mart will take responsibility for breaking down larger loads and delivering the product to other Wal-Mart stores” (Ehring 1).
If someone were to be asked what their profession is and they replied with supply chain management, they would likely be met with blank stares and the question, “what is that”? To briefly sum it up, supply chain management (SCM) is the overseeing of flow efficiency and storage of a product from the point of origin to the point of consumption. In the fairly recent past the implementation of supply chain managers has been increasingly more necessary for businesses to cut costs in manufacturing and distribution. Therefore, as technological advances continue to leap forward, SCM is able to be constantly modified to increase the growth of businesses and generate greater profit.
Investopedia.com defines a supply chain as follows: "Supply chains include every company that comes into contact with a particular product. For example, the supply chain for most products will encompass all the companies manufacturing parts for the product, assembling it, delivering it and selling it." (www.investopedia.com)
“Supply chain. Product life cycle processes comprising physical, information, financial and knowledge flow or movements whose purpose is to satisfy end-user requirements with physical products and intangible services from multiple, linked suppliers.” In other words, supply chains compose a network of different companies that cooperate closely for goods delivery.
Within the manufacturing sector, supply chain management is important since it involves many movements of goods, raw materials and finished goods. It is therefore important to maintain this free flow of goods with in the manufacturing industries to ensure that all goods are delivered on a timely manner (Ross, 2010). In manufacturing, there is need for inward movement & storage of raw materials, inventory for the work-in-progress, and finished goods movements. Further, finished goods that have been supplied can also be returned to ...
Storey, J and Emberson, C et all (2006). Supply Chain management: theory, practice and future challenges. International journal of operations & production management, vol: 26 (7) pp: 754-774
Supply chain management is basically refers to the fundamental supply chain analysis of the organization which predominantly describes functionalities from source to the delivery point. In this process of delivery, supply chain management framework divides in four categories: In Planning the products and suppliers evaluated and selected, Sourcing pull the information process including contracting, ordering and expediting, Moving is a physical process from suppliers to end user and Paying is the financial process including payment and performance measurement.
When an organization decides on what distribution channel to use, it creates the final link in the supply chain. A supply chain is the complete order of suppliers that contribute to creating the product or service and distributing it to business users and consumers. This process of organizing the flow of goods, services, and information among members of the supply chain is called logistics. Physical distribution is a major focus in logistics management.
The ability to manage supply chains effectively is a key component of corporate success. Adopting a supply chain management strategy (inventory strategy) that works to minimize costs, enhance quality and efficiency of products and services rendered, and maintain sufficient levels of inventory while reducing associated carrying costs is ideal for all businesses. Achieving such a goal, however, is quite challenging and most businesses adopt inventory strategies that best enable them to fulfill their most primary needs (e.g. reducing inventory costs and delivering high-quality products). Supply chain management relates to “the management and coordination of a products supply chain for the purpose of increasing efficiency and profitability” (Investopedia, 2008). In order to deliver quality products to customers in a timely manner while decreasing operating costs, businesses must have a sound understanding of supply chain management (SCM) and all that it entails.
A supply chain refers to all parties to manufacture a product, to transport, to support services, and fulfill a purchase. It is a system that transforms raw materials or resources into a finished good to be delivered to the customer. Thus, the product is moving from suppliers to customers. Supply Chain Management refers to a wide variety of activities that firms and industries use to coordinate the key players in their procurement process (Laudon and Traver, 2015). The supply chain, which is the process to connect different partners to better serve the customers, involves the manufacturing, purchasing, transportation, operations, and physical distribution. Supply Chain Management has the power to control, plan, design, execute, and monitor the supply chain
‘Supply chain management integrates supply and demand management within and across companies. It encompasses the planning and management of all activities involved in sourcing and procurement, conversion, and all logistics management activities. Importantly, it also includes coordination and collaboration with channel partners, which can be suppliers, intermediaries, thir- party service providers, and customers’. (Web: Council for Supply Chain Management Pr...
A supply chain may be characterized as a coordinated procedure wherein various different business elements (i.e., suppliers, makers, wholesalers, and retailers) cooperate with an end goal to: (1) gain raw materials, (2) change over these raw materials into indicated complete items, and (3) convey these last items to retailers. This chain is generally portrayed by a forward stream of materials and a retrogressive stream of data. For a considerable length of time, scientists and professionals have basically researched the different procedures of the supply chain separately. As of late, in any case, there has been expanding consideration put on the execution, configuration, and examination of the supply chain in general. From a reasonable outlook,
A supply chain is an arrangement of associations, individuals, exercises, data, and assets included in moving an item or administration from supplier to client. Supply chain exercises convert regular assets, crude materials, and parts into a completed item that is conveyed to the end client. In advanced supply chain frameworks, utilized items might re-enter the supply chain sometime or another where lingering quality is recyclable. Supply chains connect value chains. A common supply chain starts with the natural, organic, and political regulation of characteristic assets, emulated by the human extraction of crude material, and incorporates a few creation interfaces before proceeding onward to many layers of storage houses of steadily diminishing size and progressively remote geological areas, and at last arriving at the customer.
Supply chain management has been defined as that process that involves the management of information, materials, and all the finances that are handled within and across the entire supply chain process (Christopher, 2016). The management is usually done through out the entire supply chain management from that moment when the suppliers are involved through all the manufacturing activities, different distribution activities, and the way that the products are served to the final product consumer (Turban, et al., 2002). The process also includes all the activities that different organizations offers to their customers as after sale services for purposes perfecting their services and products towards their highly valued customers (Christopher,