Supply chain is defined as a set of three or more entities (organizational or individual) directly involved in the upstream and downstream

flow of product, services, finances and information from a source to customer.

It is the process of planning and controlling the efficient ,cost-effective flow and storage of raw materials, finished goods and related information from point of origin to point of consumption for the purpose of conforming to customer requirement

Supply chain is to maximize the overall value generated Reduce uncertainty & risks, inventory, cycle time Improve business processes, customer service

Increased profits & competitiveness

Forecasting demand Selecting suppliers Ordering material Managing inventory Scheduling production Shipping and delivery Organizing information exchange

 Customer
Inventory

focus and demand

management management management

Operations Distribution

Procurement: the responsibility for acquiring the goods and services the organization needs:
goods:

raw materials production parts maintenance, repair and operating supplies (MRO)
services:

consulting services utilities workers health care benefits

Objectives of inventory management:

minimize costs:
working capital carrying costs scrap and rework

Inventory management tasks:

make decisions about:
safety stock replenishment production runs excess stock.

Operations management is the activity of managing resources and process that produce goods and services.

Distribution is the activity that is concerned with receiving parts or finished goods, storing them until they are required and then delivering them to the customer.

Functions of distribution: inventory management order processing warehousing transportation

Cycle view
PLANNING AND PROCUREMENT CYCLE

DEMAND CYCLE

SUPPLY CYCLE

Customer order arrives

Demand cycle

Planning and procurement cycle

Supply chain

materials stock

finished products stock

Customer order arrives

Demand cycle

Planning and procurement cycle

Supply chain

Materials stock

The bullwhip effect on the supply chain occurs when changes in consumer demand causes the companies in a supply chain to order more goods to meet the new demand.

Enterprise Resource provides a single up-to-date database incorporating manufacturing, finance and human resource applications extended to include tracking of orders and inwards goods, work in progress and delivery of finished goods.

The process of planning, implementing and controlling the efficient, effective flow and storage of goods and services, and related information from the point of origin to the point of consumption for the purpose of conforming to customer requirement.

farmers

suppliers

farmers

Packing material suppliers Raw material suppliers

Packing material store Raw material store

Foods factory

Distribution centre

Supermarket

Foods factory

mail order

Consumer

Factory warehouse

Regional depot

Wholesaler

Retailer