Behind every successful man, there is a woman. And, behind the success of every e-tailer, there is a robust supply chain management!
You have heard about the mega-success stories of e-commerce brands such as Amazon, Taobao, eBay, Alibaba, Walmart, Flipkart and Snapdeal. They have thousands of products across hundreds of categories with millions of customers shopping every day. How do you think they manage to run such big empires? The secret lies in the performance of their supply chain management.
Whether your business is small or big, in growth or maturity phase, supply chain management is the need of the hour for the following reasons:
The ultimate aim of any business is to sell the product and earn revenues. If your product doesn’t get delivered to customers as per the committed delivery time, they are bound to lose their trust in you. They won’t hesitate even a single minute to switch their loyalty to your competitor. Supply chain management ensures that products reach customers in time.
Which business doesn’t want to get the maximum output at the minimum cost? One of the important functions of supply chain management is planning and forecasting demand so that production can be manufactured in alignment with predicted numbers. By doing so, unnecessary wastage of resources in terms of money, labour, inventory and transportation can be avoided, and it will naturally lead to cost reduction.
Short Product Life-cycles
The product of Company A takes 25 days to reach the customer touchpoint while a similar product of Company B takes only 10 days. It doesn’t take the much common sense to deduce whose product will sell more. When supply chain processes work in tandem, there is no scope for the delay in the product life-cycle. In fact, when you want to introduce a new product in the market, you can manufacture and launch it at a swift pace.
More Availability of Working Capital
A good supply chain management ensures that the delivery lead times (for raw material as well as finished products) and inventory holding costs go down, it will free up the working capital. The excess cash flow in the form of working capital can be used for other activities of the business.
Access Global Markets
If a business wants to expand its roots to international markets, the efficiency of production and logistics becomes more crucial than ever. Global dynamics are more complex than the home turf and require an immensely coordinated, integrated supply chain.
Given its growing importance in the business, it is recommended that organizations hire employees who hold necessary knowledge, experience and supply chain management certification. They can also train existing employees through various online supply chain management programs.