Why do companies invest millions in optimizing their supply chains? The answers lie in three primary drivers:
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Often referred to as fulfillment, delivery encompasses the coordination of customer orders, development of a warehousing network, and selection of carriers (like shipping fleets, air freight, or trucking companies) to transport goods to the final destination. This phase directly impacts customer satisfaction, as consumers expect timely and undamaged deliveries. 5. Returns (Returning) fundamentals of supply chain management
These are the company’s internal operations, including manufacturing, processing, inventory management, and quality control.
: The movement of money, credit, and payment schedules, primarily flowing from the customer back toward the supplier. 3. Core SCM Processes and Stages Why do companies invest millions in optimizing their
According to the industry standard model (SCOR—Supply Chain Operations Reference), all supply chains are built on five foundational processes.
: Encompasses wholesalers, distributors, retailers, and the final customer. If you share with third parties, their policies apply
Sourcing is the process of identifying, evaluating, and contracting with suppliers who provide the raw materials or components needed to create a product. Procurement managers must negotiate prices, manage delivery schedules, maintain supplier relationships, and create backup plans to mitigate the risk of supply shortages. 3. Manufacturing (Making)