Essay Sample on Supply Chain Logistic Drivers

Introduction

The are three supply chain logistic drivers which are; inventory, facilities, and transportation (Chopra, 2019). An inventory comprises of the work in progress, raw materials, and finished goods. Making changes in the inventory policies can affect the effectiveness and responsiveness of the supply chain. When creating an inventory three decisions should count, and one of them is the volume of the inventory required to meet the product demand in the duration between the purchase of that particular product (Chopra, 2019). The other consideration is the accuracy of the inventory to avoid uncertainty in the future. The inventory should be made in a way that forecasting is possible to deal with increases in demand.

Is your time best spent reading someone else’s essay? Get a 100% original essay FROM A CERTIFIED WRITER!

Order now

The facility is the area where the products are stored, assembled, and made up. There are two types of facilities, warehouses, and factories (Hugos, 2018). The factories focus on creating the products and assembling them whereas in warehouses focus is on storekeeping whereby suppliers can offload large quantities of various products. The type of facility chose by firms enhances efficiency.

Transportation involves the movement of inventory from one place to another in the supply chain. There are various modes of transport that a company can use which are; use of airplanes which are fast thus enhancing responsiveness but very expensive and the airport facilities are limited.; rails which are slow but affordable though rail facilities are also limited; trucks are the most suitable to use for transport because they can easily maneuver to remote locations and are relatively quick (Hugos, 2018).

Identify and explain supply chain cross-functional drivers and the role they play to make the chain either more efficient or responsive.

The are three cross-functional drivers in the supply chain which are, sourcing, information, and pricing (Shams, Vrontis & Weber, 2018). Sourcing comprises of a chain of business processes that will be needed to procure goods and services (Shams et al., 2018). Managers in an organization should make the ultimate decision regarding the tasks that will be carried out within the company and those that will be externally sourced. To increase efficiency in the supply chain, two consideration should be looked into when making sourcing decisions (Shams et al., 2018). The first one is the selection of suppliers where they should decide how many suppliers will be involved in each activity (Chopra, 2019). Again, there should be an appropriate criterion put in place to evaluate and select the suppliers. The other consideration is whether they should conduct the task from external sources or in-house depending on the influence it has on the total supply chain productivity.

Information acts as the link between various stages of a supply chain allowing for coordination as well as the increment of total supply chain profitability. With adequate information, the firm can predict the future then plan to meet the expected demands. Again, information influences the existence of technology for integration and analysis.

Pricing is the determination of the amount that a firm will charge for the goods and services. The behavior of the consumer depends on pricing which in turn affects the performance of the supply chain. Pricing is also used to balance supply and demand (Chopra, 2019). The firm should, therefore, choose whether they will set a fixed price or varying prices which may be based on responsiveness or the customer's location.

Explain the role of distribution and the value of the distributors in the supply chain.

Distribution entails flow of goods and services from the manufacturers to the consumers. Distribution has various roles, and one of them is supporting the operations of manufactures by minimizing their costs with the aid of long production runs (Ross, 2015). The other role is to ensure there is a balance between supply and the demand by delivering the required products to various customer locations (Ross, 2015). The third role is to help avoid instances of uncertainty. Facilities dealing with distribution can offer protection to the inventory thus avoiding probable errors, any supply disruption and increase in demand (Chopra, 2019).

Distributors are significant in the supply chain as they are highly flexible thus reducing the time taken to deliver goods and services to consumers as well as reducing the payments that you would incur having sourced directly from manufacturers. Again, most distributors are locally reachable thus maintaining a good rapport with their customers who in turn trust them based on mutual dependency. In case the customers have any complaints then the distributor can get to the location of the consumer and address the issue at hand. Distributors also offer knowledge of the products to their clients, and they introduce innovative products to them thus maximizing profits (Ross, 2015). In addition, the distributors can easily converse with their client unlike the case of manufactures where there may be a language barrier.

References

Chopra, S. (2019). Supply chain management: Strategy, planning, and operation.

Hugos, M. H. (2018). Essentials of supply chain management. John Wiley & Sons.

Ross, D. F. (2015). Distribution Planning and control: managing in the era of supply chain management. Springer.

Shams, S. R., Vrontis, D., & Weber, Y. (2018). Strategic innovation management: a cross-functional vision to be materialised. In Business Models for Strategic Innovation (pp. 27-36). Routledge.