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Originally Posted On: What Is the Supply Chain? (entrepreneursbreak.com)
Keeping products moving through a company is essential. The supply chain is the beating heart of a business. It feeds the organs, or the departments of a company, with vital produce that they need to keep trading.
Without supply chain management, a business would falter and fail.
But exactly what is the supply chain?
In this article, we’ll discuss why developing a robust supply chain strategy is essential to any business.
What Is the Supply Chain?
The supply chain is the entire process involved in the making and selling of goods for commercial purposes. It includes every stage of a product’s journey through a company from the moment the item is ordered right through to the moment it is sold.
Why Is Supply Chain Management So Important?
A well-oiled supply chain management system will help reduce costs, keep stock flowing through the business, and improve the speeds of the production cycle.
Supply chain management is an umbrella term that covers everything from product development and production to procurement and logistics.
Without efficient supply chain management, a company is liable to lose customs and damage its competitive edge.
Supply Chain Vs. Logistics
The terms supply chain and logistics are often used interchangeably. There can be some confusion over the difference between the two.
Logistics specifically refers to the element of the supply chain relating to the movement of products.
Good logistics management ensures that there isn’t a delay in the delivery of the products and that distribution costs are kept to a minimum.
What Supply Chain Jobs Are There?
There are numerous different supply chain management jobs. These range from manufacturing through to sourcing products and materials. The supply chain also incorporates logistics jobs including transporting materials and goods, as well as warehouse management.
The supply chain management salary will vary depending on the specific role and the scale of the operation.
How Do You Run a Supply Chain?
To run a supply chain, you’ll need to know what a GPO is. A GPO is a group purchasing organization. The group leverages the purchasing power of its members to get better deals from suppliers.
The supply chain starts with the production of products. This begins with the design or inception of the product, then goes onto the sourcing of materials.
The next stage in the supply chain is production.
From here, the product gets shipped to warehouses. After this, they will be shipped out to stores or directly to the customer.
What KPIs Are Used In the Supply Chain?
Measuring performance is always important, and there are many key performance indicators (KPIs) used in the supply chain.
The most common KPIs used in the supply chain include daily performance, cost reduction, production service rate, inventory turn, production time, lead time, and return rate.
Improving the Supply Chain In Your Business
What is the supply chain? The supply chain is an integral part of any business that handles products. An inefficient supply chain could lead to a loss of customers and revenue.
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