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Supply chain management in businesses
Complex system of interconnected business involving critical provisioning of product and packaging service that is in the end required by the customers, needs supply chain management. Supply chain management at length includes storage space for raw materials and its movement, inventory of work in process supply chain, that is, completion of goods from the foundation stone to their consumption. It is built on the concepts of specialization and globalization that defines changes that occur in supply chain, advancement of the processes and procedures and devices employed in its management in this new era.
Importance of supply chain management
It is basically coordination of complete and planned functions of universal business and their strategy in an individual company and across other businesses that come within supply chain. It is meant for the purpose of progressing long term performance of a particular company and management of supply chain as a whole.
Significance of inventory management
One need to be particular about the stocked goods, their sizes and placement and the key to this is inventory management. To safeguard course of production that is planned and regular against the disturbances like running short of goods at different locations or within many locations of a network of supply, inventory management is required.
Inventory management has a wide scope concerning replacement of lead time, inventory's carrying cost, and management of assets, valuation and forecasting of inventory, physical space available for inventory, goods returned and those defective. An inventory is maintained for three basic reasons which are time, uncertainty and for scale of economies.
It is an ongoing process as there is a shift in the needs of business and reaction to their comprehensive environment which needs balancing of requirements that are competitive, leading to optimal levels of inventory.
Solutions offered to improve supply chain
Supply chain can be improved with certain solutions. There should be an effectual use of import or export methods to acquire manufacture goods to and from the suppliers and customers that are delivered hassle free on time which in turn protects the investments made by the company.
Another supply chain solution is to advance techniques of inventory management that will improve ratio of inventory turnover and frozen assets will be transformed into cash.
The best and the most important solution in supply chain management is communication. Keeping the staff well informed and communicating the techniques to ensure that they are in good spirits with the best suppliers of a business will lead the organization well.
