Globalization and the demand and the accelerated response on market by the competition leads us to think more intelligently and creatively.
In today’s market, we realize that products by themselves will not provide a real value, especially when the environment is highly competitive. There lies the challenge: to make a product that can be in the hands of the consumers just in time and just where it’s needed.
Day by day it becomes more difficult to differentiate the products at the point of sale, every day competition launches most original products at lower prices; so the only way to stay competitive is to have a supply chain optimally designed to efficiently provide and get as quickly as possible to the consumer under the lowest possible cost.
The Supply Chain Management is the set of processes of production and logistics, whose ultimate goal is the delivery of a product to a customer. Which means that the supply chain includes the activities associated from obtaining materials for the processing of the product, to its placement on the market.
Therefore it’s important to know that the Supply Chain Management is the proper management of the supply chain, which includes the activities associated with the flow of goods, information and money from the supplier to the customer.
There are 4 major steps that can help you to be more successful on the market:
- Planning: This involves tracing in detail the process, where demand and supply are the main elements to bring products to the consumer successfully.
- Supply: At this point is essential to create plans and establish partnerships with suppliers at minimal costs.
- Manufacturing: At this stage, in addition to the production of a high quality product, this process requires greater flexibility and speed at work, and low costs to respond competitively in the market.
- Delivery: This is the stage to perform the efficient movement of goods between warehouses and customers.
Let’s talk about the advantages
Actually there are many advantages inherent in the Supply Chain Management for a company, just to mention some of them:
One of the biggest advantages of the Supply Chain Management is that this model is more effective at negotiations, thanks to the possibilities that new technologies offer for the exchange of information with the suppliers.
Another advantage is that as a producer, you can have more control managing your suppliers. The Supply Chain Management provides access to a greater number of potential suppliers and a greater number of offers on a quick, easy and automated way.
It also provides a significant reduction in production costs by between 20% and 30%, the integration of an efficient Supply Chain Management you can dramatically reduce your business’s operating costs.
A further advantage is the reduction in provisioning time input as a direct and real-time communication between the supplier partners.
There are more benefits as the significant improvements in inventory management, because the information is always available, online and at a real-time. For example, online information can create a reminder to the suppliers about the needs of production and optimize the management of inventory reserves.
The detailed deadlines for supply monitoring, production deadlines and shipping dates is another advantage of the Supply Chain Management, it ensures a greater ability to react to market demand.
What is the challenge?
The real challenge is to react quickly and efficiently to market demands!
The Supply Chain Management is currently one of the best models for manufacturers, there are reasons such as running through open network, low cost and versatility.
In addition, the Supply Chain Management can be used to get an overall idea of the business, also helps to react on a faster and really smart way in front of the challenges of the changing customer demand compared with the availability of resources for the production manner.
One of the main allies for a successful Supply Chain Management are the new technologies, which can provide relevant information to improve the efficiency of the company.
The facilities offered by new technologies are:
- Information integration: You can have all the information about your business wherever you want whenever you need it.
- Synchronized planning: Every member of your Supply Chain has an important role and that’s why everyone has to act on coordinated way.
- Coordinated workflow: When you have the information and you really know what is your role to play, you just have to bring the action to your plan.
- Generating new business models:
- Is the chance to know closely what are the new opportunities to your business, just remember: keep it simple, quick and at the lowest cost possible.
You also have to remember that Information is the main input for each of the actors on your Supply Chain Management and the speed with which you can access to it makes a big difference over the competition when it comes to responding to market demands.
In today’s world there are many challenges to meet the demands of the market , but this is where we must need to be smart and resolve questions like: What do I sell? How to get the fastest, efficient, and inexpensive as possible to my client? What kind of models must adapt my business to succeed? Why models such as the Supply Chain Management is ideal for my company?
Look at this article to find out more about the importance of the supply chain to keep your customers happy.