Why is Supply Chain Management Important?

The overall success of any company that is involved in manufacturing start from efficient management of the supply chain. Planning, execution, and monitoring the supply chain are vital in fulfilling customer demands and achieving business targets. Here are some key points that show the importance of SCM:

1. Budget Management

Cost of materials, manufacturing, and logistics are the key elements in defining goods/service prices. To supply goods to end users at a reasonable price, it is important to have a cost-effective supply chain, which includes, reducing material waste, managing inventory, and improving production values and quality raw materials.

2. Amplify Customer Experience

Apart from reduced costs, SCM also helps in better logistics and return management. Thus, a customer will experience delivery at the right time and right place. Also, SCM help in producing invoices and handling post-delivery services (collecting defective products, refund, and product replacement). All these can make a better customer experience and improve marketing.

3. Control Over Infrastructure

As SCM deals with every part of the supply chain, every little detail in infrastructure, machinery, and raw materials can be visualized. This can help in planning for better outcomes and dealing with depreciation. SCM also helps in fault detection, elimination, and mitigation and thus helps in continuous production.

Every product or service we use goes through a wide range of operations before it gets into our hands. This is a complete process of Supply Chain Management that allows the complete flow of goods failing to which might affect the groundwork involved in this chain of events may result in an unsatisfactory customer/end-user experience.

Being said that there goes a lot of effort and task management from gathering the raw materials to delivering the end product for business sustainability. Supply Chain Management deals with control and coordination of such chain of events to improve efficiency and meet end-user demands.

In this article, we are going to look at What is Supply Chain Management, the various models of SCM, and much more