Supply chain management And its Importance
Supply chain management is broadly detailed system used by small and large businesses. It is the process from obtaining raw materials, manufacturing and finally delivering the product to the customer. A well-organized supply chain management defines optimizing operations and functionality to be faster and in the most streamlined and cost-effective way possible.
Supply chain management (SCM) is the most important part of any business as it deals with the effective management of supply chain activities such as inventory control, Quality check, warehouse management and delivery management to expand customer value and achieve a competitive advantage. Organizations who use strategic SCM are able to function at their best capacity to provide and distribute their products and materials efficiently.
Supply chain management increases profits, creates efficiencies, lowers costs and raises collaboration. SCM enables companies to manage inventories in better way, carry the right amount of material, deal with disruptions, get more profit and meet customer demand in the most effective way possible. These SCM benefits can be achieved through the appropriate strategies and software to help manage the growing complexity of today’s supply chains. There are various reasons that supply chain management is important to retailers and businesses. SCM can enhance customer service, lower operating costs, and boost financial position of business. Other benefits include lower inventory costs, improved process integration, and improved quality.
One of the most important part of a business is its customer service. The correct product assortment and quantity must be delivered to the customer efficiently and on time in order to ensure they are satisfied. Customers also expect products to be serviced quickly when requested. SCM can help ensure that customers are satisfied at all times, which improves the bottom line of business.
SCM decreases overall supply chain costs as retailers and manufacturers often depends on supply chain managers to create networks that meet customer service goals at the most affordable rate. Retailers also require supply chains to quickly deliver products on time in order to limit inventory holds longer than necessary. Supply chain management further reduces production costs because manufactures require supply chains to deliver materials to different plants to ensure proper material supply at all times.