The supply chain industry is an integral part of a nation’s economy and its foundation. A well-planned and effective supply chain system reduces production costs, improves business ease, enhances consumer experience and contentment, and, most specifically, promotes rural and urban consumption development due to increased market accessibility.
The complexity of today’s global supply chains necessitates a data-driven solution to supply chain management. From sourcing to manufacture and distribution to the ultimate user, data-driven SCM gives insight from end to end for controlling the information flow, products, and services. Additional aspects like efficient price controls, excellent client and supplier relations, implementing new supply chain technologies and obtaining the right logistics partners, all play a role in effective supply chain management.
Because of the COVID-19 outbreak, the Indian economy is in a state of flux as the year comes to a close. With a year-over-year growth rate of only 4.5 percent in the second quarter of FY20, India had its worst growth in 6 years. Increased financial obligations and dwindling customer confidence aggravate the condition even more. As the supply chain has a direct or indirect impact on all the other operating areas of the economy, even small supply chain disruptions or failures could have a detrimental ripple effect over the whole industry.
Given these uncertainties, supply chain stakeholders need determine the major difficulties they face and develop concrete plans to address them. As India prepares to break free from its downward spiral, the nation’s supply chain infrastructure will be even more essential.
What is Supply Chain?
From the early phase of acquiring raw materials through the ultimate delivery of goods or services to customers, a supply chain is a whole process of manufacturing and distributing a goods or services.
The supply chain covers all aspects of the manufacturing process, such as the events that occur at each phase, information that is shared, natural resources that are utilized to generate valuable materials, human resources, as well as other elements that go into the final output.
What is Supply Chain Management?
Supply change management is a comprehensive and detailed system or process used by businesses of all kinds and industries to control and manage a range of procedures that occur between the development of a product and its delivery to customers.
Benefits of Supply Chain Management:
When a company uses efficient supply chain management, it gains an advantage in its sector by lowering the risks associated with purchasing raw materials and selling finished goods or services. The advantages of supply chain management are numerous. Following are some of its most important benefits.
- Reduced Operational Costs
Inventory management is part of supply chain management, and if properly planned and implemented, it can significantly decrease costs.
Inventory management software enables managers to profit from an on-demand or lean inventory approach to maximise the output of internal inventories.
Managers can do this by stocking just enough items to meet the needs of customers while also freeing up precious storage space.
This has aided corporations in pursuing precision when it comes to needs, allowing them to close down less productive and inefficient warehouses while saving a lot of money.
- Higher Rate of Efficiency
Companies can better foresee demand and respond to it when their supply chain activities, which include resource acquisition, logistics, and delivery, are systematically designed and implemented. This improves a firm’s ability to adapt to challenges, changing markets, and shifting industry trends.
- Boosts Consumer Experience
The ultimate aim is to deliver the correct products client in the correct amount at the right time. If customers find any problem with the ordered items, they frequently seek assistance from the organisation or delivery partner.
Customer queries/requests/complaints can be resolved quickly by organizations with a professional supply chain management system, allowing them to retain consumers and earn their loyalty.
- Enhanced Risk Management
Studying both big-picture and detailed supply chain data can expose possible threats, allowing businesses to quickly implement backup plans in advance for unforeseen events. Businesses can avoid terrible consequences by preparing ahead of time instead of responding to supply chain delays, quality control problems, as well as other challenges as they occur. Businesses can also ensure faster operations by better identifying risks.
- Improves Financial Performance
Supply chain managers are important assets to businesses as they utilise their skills and experience to assess performance, streamline operations, minimise costs, handle inventories, reduce product life cycles, and uncover new profit-generating prospects.
They also make certain that all capital assets (transportation, plants machinery and equipment, and etc.) are utilized to their full potential in order to balance expenses and outcome.
- Enhanced Quality
The quality of a brand’s products and services is directly influenced by appropriate supply chain management, which is carried out in accordance with global CSR guidelines and standards.
This conformity aids in the long-term viability of the business and the satisfaction of customers.
- Optimized Supply Chain Network
Maintaining a long-term supply chain management system is challenging.
One of the greatest approaches, according to some of its proponents, is to combine lean techniques (such as waste minimization) with agile. The company can improve the supply chain network by merging all of the data they’ve received from different sections of their company.
Why is it beneficial for the Indian Industry Sector?
The sustainability of companies in today’s economic environment and evolving market is dependent on innovative and practical corporate strategy, as well as on supply chain management to a large extent.
Companies need to connect supply chain and logistics with IT to enable effective co-ordination among all components of the supply chain, from procurement and producing to delivering to the destination – the consumer, in order to meet growing consumer demands. Keeping a proper balance in the economy requires efficient supply chain management.
Featured Image Source: Corporatefinanceinstitute.com
Article By: Somasree Roy
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