Discussion
Discuss about the Emerging Issues And New Challenges In The Retail Supply Chain.
The supply chain refers to the network of people, organizations, activities and resources on involved in manufacture and product sale. It starts from the material delivery by the suppliers and ends until the final delivery to the ultimate user. This supply chain known as channel of distribution is from the manufacturer to the consumer.
The management of supply chain is the control of supply chain activities to enhance the customer’s value and achieve a sustainable competitiveness. It represents the efforts by the firms of supply chain to run supply chain in the cost effective and efficient manner (Christopher 2016). It is the process of overseeing the information, materials, and finance as they transfer from manufacturer to wholesaler to supplier and to the final consumer.
Logistic management is small portion of management of supply chain that contracts with the efficient management of goods. It is the teachnique of integrating the maintenance and transport of goods in and out the organization(Jacobs, Chase and Lummus 2014). The ultimate objective is to provide maximum consumer satisfaction by providing the correct product with the exact quality at the accurate time and the exact location at the reasonable price to the final consumers.
The chosen company to be analyzed is the group of clipper that is a worldwide shipping enterprise. It was instituted in the year 1991 by Torben Gülnar Jensen, after a divide of Armada Shipping, which was started in 1972 together with Jørgen Dannesboe. The company primarily focuses on transportation large sized bulky goods. It also invests into ferries and dry bulk vessels. The head quarter of Clipper Group is in Copenhagen, Nassau and Bahamas. More than 200 workforces work on shore and deal with extra 1400 seafarers.
There are various views regarding the relationship between the SCM and the logistic. In the chosen company of Clipper Group, four conceptual perspectives reguarding the relationship between the two can be identified. The logistic is a part of supply chain management. Although, previously it was considered as non-separable. The logistics management revolves around the logistic (Stadtler 2015). The clipper has a sound and successful logistic that enhances the value of the organization. The logistic management of clipper involves number of activities including transportation, inventory and warehousing. There is sound planning, coordination and control of the goods within the countries. The company also takes care of the packaging of the material and forecasting.
Brief overview of the chosen company
In order to keep the retail curve ahead. Clipper specializes in the retail logistic. They are the market leader. They collaborate closely with the clients and make continuous innovation in this. The clipper believes in giving its customers confidence in and seeks for new opportunities.
Of late, due to global competitions, the companies are impelled to provide lower cost, higher quality and endurable products. In this context, various programs techniques and technology related to logistics are imposed on the companies. The clipper became aware of the importance and benefits of the cooperative relationships with the suppliers and clients. The supply chain management creates a framework inside which all the logistic activities and operations take place. For example, the SCM have a direct impact on the in house inventory of the clients that has to be transported with the help of sound logistic management. The supply chain deals with the goods and logistic deals with the transportation of the good. Therefore, it can be said that the objective of supply chain is to maximize the sakes and the objective of a sound logistic management is to provide a sound customer satisfaction by delivering the goods in shorter lead-time.
Consumer satisfaction measures the expectation degree of a consumer concerning a commodity provided by an enterprise. Although concept is abstract, it implicates factors such as product quality, service quality and the price of the commodity.
As a logistic manager of Clipper group, it can be said that logistic management consist all parties including manufacturer, marketers, suppliers, transporter, and warehouses. The parties are directly or indirectly involved in fulfilling the customer needs (Stadtler 2015). The primary objective of the logistic are to improve the overall performance if the organization and provide ultimate consumer satisfaction by improving the products and delivery of the commodities.
Many indicators show the relation between the consumer satisfaction and the logistics management. The most important indicator is the cost and the product. As a logistic manager, it should be aimed that the cost of the supply to the final consumer is minimized. Taking into consideration the quality and time, which is the two major indicator of consumer satisfaction, the logistic manger must make sure that the finished goods are transported with the cheapest method and the goods are handled carefully to minimize the loss. The safe handling of goods that are to be transported is another important indicator that can affect the consumer satisfaction. Therefore, the channel of distribution and the management of logistic are to be done in such a way that the consumers can get the maximum satisfaction.
The relationship between Supply chain management and logistics management of the chosen company
ERP stands for enterprise resource planning. The core integrated business process consists of a business management software that helps in storing, managing and interpreting data from the business activities. It refers to the suite of integrated applications, which uses the databases that are common and is maintained by data base management to track organizational recourses like raw materials, cash and capacity of production (Leon 2014). The ERP facilitates the information flow between all functions of the business and links with the outsider. The system helps in getting error free transactions and production, thereby increasing efficiency of the entity. It runs on several computer hardware and configuration networks using a database as an repository of information.
The enterprise Resource planning software which is known as ERP is a part of e commerce that involves in management of resources that are available in the business organization. The ERP has the best capability in reporting that help to analyze the company. In the given organization Clipper, the ERP is enlisted with the consumer system of management. It helps in storing all the previous correspondence with the consumers so that the manager can easily go through the records whenever he wants. Various aspects in the organization help in improving the level of consumer satisfaction.
In clipper, the aspects of ERP system that improves the consumer satisfaction level can be jotted down as follows:
- Accurate Provision of Delivery Dates: The ERP allows building a strong relationship with the existing and new customers. It helps Clipper to complete accurate provision for delivery dates. It also gives delivery services at the customer’s doorstep. In addition to it , it allows to E- shop to build a sound relationship with the customers with the help of new innovative features of technology.
- Accurate provision of Order Dates: The system of ERP also allows the Clipper to manage the dates of deals between business and the customers. It also helps to acquire complete information of the transaction dates with proven automated reports. When the customers reserve the order it automatically reminds the management to take an action on the behalf of the requirements of the order. This is as per the predefined authorities rights within the soft ware.
- Returns/Repairs Tracking: At times when there is return of products to the business, the clipper needs to be able to change or repair the product. This is a very effective way to manage all the activities regarding the problems of the customers.
- Accurate Provision for Discount:
ERP system allows deducting refund and discount of its commodities. If the customers purchase the product and there is a need for have offering discount for the commodities, the system also allows detecting the discount automatically and can measure the percentage of the rebate as defined in the backend system (Database). It is very effective for the customer’s satisfaction. This is because the consumers in general feels delighted with the discount and low prices and it motivates them (Jacobs, Chaseand and Lummus 2014).
- Issued Invoice:
As it is known, a sound system of ERP has many structures for its customers. The primary role of ERP is to issue invoice for its clients as per their requirements. It slows to mange allows to manage its activities with complete satisfaction of clients and customers.
- Time Saving:The system of ERP saves a lot of time for the customers by by taking instant action. There are complete ranges of actions that the ERP takes to allow its customer save time.
ERP System save much time for the customers it allows Customers to save their time and takes action instant. It gives the company a complete range of action.
Poor logistic decision-making and planning may result in excess of expenses. Miss of deadlines of delivery (Fernie and Sparks 2014) and damage of goods can lead to great loss. It should be kept in top priority that there should be efficient reduction of the logistic cost for the business, so that the company can carry on with the shipping and remain financially viable (Schönsleben 2016).
Given the demands of the consumer and the fluctuation of the global business climate, the company must smartly practice the logistic management. Clipper implements its time and resources to minimize the cost related to logistic managements. The factors that affect the logistic cost in the business are as follows:
- Cost of fuel
- High transportation fees
- Delay in arrival at the ports
- Complex government regulations
- Increase in expenses of the warehouse.
The ways that can help in the minimization of the logistic cost are as follows:
- Consolidated shipments:The shipping of in full container load (FCL) is preferable to less than a container load (LCL); The FCL is safer and more cost effective. For the transportation of small freight, it a good way to reduce logistic cost (Fernie and Sparks 2014). It also involves a combination of various small ships from multiple suppliers sharing the same destination into one consolidated shipment.
- Insurance of cargo:
Sound logistic planning deals with the insurance of the cargo. The insurance must cover fully the products value to prevent from unpleasant circumstances. The costs saving strategies will not mean much if insurance is not done.
- Using a single-integrated platform: The chain of supply should always be assimilated in a single platform there are accessible to the involved party. The duplication of activities can be avoided across operations in this way. The duplicated efforts are time consuming, can impair the efficiency and can leave room for errors.
- Optimized use of resources: At times, if situation takes place that the company assets are being insufficiently used like underutilization of fleet vehicles, facilities or inventories. In such case, the revenues are directly affected. By optimum use of assets, there can be improvement in the clippers business efficiency. Through rearrangement of the delivery schedule of goods, the entire fleet of vehicles can be kept active throughout the day.
- Time planning: a well planning of time and operations is important to reduce the cost of logistics. The operations include schedule of production shipping routes and time for transit. If the management takes hasty decisions and last minute choices, it will result in delay and miss of deadlines. This may result badly on both the company finances and image.
Conclusion
Previously, there has been confusion regarding disagreement among the business and operational professionals about the relationship between logistic and supply chain management. Various definitions have been offered regarding this. This can be concluded that logistic is a part of the supply chain management and both are interrelated. In the above discussion the SCM and logistic of the chosen company has been analyzed and a better method of management has been proposed.
References
Aguirre, G.C. and Goudge, D., 2014. LOGISTICS AND SUPPLY CHAIN MANAGEMENT. Patrick D. Fountain, p.57.
Christopher, M., 2016. Logistics & supply chain management. Pearson UK.
Fernie, J. and Sparks, L., 2014. Logistics and retail management: emerging issues and new challenges in the retail supply chain. Kogan page publishers.
Jacobs, F.R., Chase, R.B. and Lummus, R.R., 2014. Operations and supply chain management (pp. 533-535). New York, NY: McGraw-Hill/Irwin.
Leon, A., 2014. Enterprise resource planning. McGraw-Hill Education.
Schönsleben, P., 2016. Integral logistics management: operations and supply chain management within and across companies. CRC Press.
Stadtler, H., 2015. Supply chain management: An overview. In Supply chain management and advanced planning (pp. 3-28). Springer, Berlin, Heidelberg.
Sustainment, A., 2014. Enterprise Resource Planning.
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