Importance of SCM to Wholesale/Retail Industry

Please review the information below and then answer the corresponding question(s).

 Supply Chain: All organizations, processes, and activities involved in the flow of goods from the
raw materials to the final consumer.

 Supply Chain Management (SCM): Planning and coordinating the movement of products along
the supply chain.

 Logistics: Subset of SCM that focuses on the tactics involved in moving products along the supply
chain.

 Instructions: Briefly describe why supply chain management is vital to the wholesale and retail
industry. What changes are occurring in the industry that may impact how products are developed and
delivered to the end consumer? Please include specific examples. 

1. Businesses must have a supply chain strategy that corresponds with their business strategy.
Depending on how a business decides to compete with the market, their supply chain is what will
ultimately support that decision. The supply chain is made up of different processes that work to
create a product, these processes lay the groundwork for where a company decides to add value.
The value chain is what gives a business a competitive advantage over others. The more value that
is created, the more a customer will want a product, and therefore, the more profit a company will
make.

Diagram and Information provided by https://mfgtec.org/supply-chain-explained/

2. Supply chain management (SCM) is the active management of supply chain activities to maximize
customer value and achieve a sustainable competitive advantage. It represents a conscious effort
by the supply chain firms to develop and run supply chains in the most effective & efficient ways
possible. Supply chain activities cover everything from product development, sourcing,
production, and logistics, as well as the information systems needed to coordinate these activities.

The concept of Supply Chain Management (SCM) is based on two core ideas: 
 1. The first is that practically every product that reaches an end user represents the cumulative effort of
multiple organizations. These organizations are referred to collectively as the supply chain.
2. The second idea is that while supply chains have existed for a long time, most organizations have only paid
attention to what was happening within their “four walls.” Few businesses understood, much less managed,
the entire chain of activities that ultimately delivered products to the final customer. The result was
disjointed and often ineffective supply chains.

3. Think of the supply chain and logistics as simply this: Logistics is comprised of storage and distribution,
which is a subset of the supply chain, which deals with additional customer-tailored components such as
schedules, procurement, inventory control, product lifecycle management, pricing, demand management,
forecasts, and partnerships with strategic and tactical enablers.

Retailers are therefore offering a broad variety of products at lower rates and providing raised levels of services in
their supply chain to attain a competitive advantage. A few of the chief advantages of supply chain management are
listed right here.

 A proficient supply chain management practice facilitates the sellers to decrease the inventory
lugging costs. There is also a proliferation in the responsiveness to the orders of the consumers.
 An efficient supply chain management helps reduce the lead time, thereby making products
readily – accessible to the clients.
 Effective supply chain management aids in enhancing all business processes, like data accuracy,
operational complexity decrease, supplier choice, purchasing, warehousing and distribution for the
retailers, etc.
 With an efficient supply chain, merchants can provide a diversity of product mix at reasonable
prices to the customers.
 Effectively managing the supply chain solutions can help conserve operational and transportation
costs in the retailing market.
 Using various technologies in the supply chain helps a retailer can acquire advantages of
maintaining good relationship with makers. With using RFID, the inventory can be tracked, and
ERP aids in increasing the performance of the supply chain.
 The supply chain can boost customer satisfaction, if the quality is maintained throughout.