What is supply chain management?
In literal words, supply chain management is a network of all those businesses which are interconnected with each other in different forms. It can be either the manufacturing of goods or delivering the services required by the consumers. And in the process of the supply chain, components can be varied at different levels.
Different parts of the supply chain include producers, vendors, warehouses, transportation management distributors, and more. It all depends on which type of business is running, and according to supply chain management is done accordingly.
Five Basic components of supply chain management
The process of supply chain management has a different range of functions. The main components of supply chain management, which improves and communicates the process more effectively are:
Planning is a tool to manage the inventory and manufacturing process. It involves the planning of different operation strategies. It also includes checking demand for the product, trends in the market, and making an excellent supply chain management.
This part of supply chain management includes the organization of all the raw materials and services or components. The company must get suitable quality raw materials to create the right quality products to maintain its market reputation.
This step is related to scheduling production activities, testing products, release, and packaging. All the lists have to be regularly updated for the available stocks or the required stock.
The delivery stage of supply chain management encloses all the steps from customer-related inquiries, distribution strategies, and transportation options. Companies must also arrange warehouses, all the import and export requirements for the finished products.
This step is associated with all the management of returning the defective products, authorizing returns, replacement, scheduling shipments, and providing the refund process. This stage is also known as the end cycle of the product. Managing the returned product’s inventory and providing proper refunds to the customers maintains a good supply chain management between the producers and consumers.
These are the main components of supply chain management that leaders or companies keep in mind while making necessary strategic decisions during the production processes. Supply chain management is needed at the production of goods and a critical system to ensure customer satisfaction.