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Category: Supply Chain Management
The Five Major Flows in Supply Chain
Supply Chain is the management of flows. There are Five major flows in any supply chain : product flow, financial flow, information flow, value flow & risk flow. The product flow includes the movement of goods from a supplier to a customer, as well as any customer returns or service needs. The financial flow consists …
The Bullwhip Effect in Supply Chain
The bullwhip effect is a distribution channel phenomenon in which forecasts yield supply chain inefficiencies. It refers to increasing swings in inventory in response to shifts in customer demand as you move further up the supply chain. Causes of Bullwhip effect The bullwhip effect is mainly caused by three underlying problems: 1) a lack of …
Aggregation Methods in Supply Chain – temporal, spatial and product
In supply chain, there are broadly three types of demand aggregation: Temporal Aggregation: Suppose you are a hyper local grocery retailer, say Big Basket. If the demand from certain area is not enough for you to deliver it every day, then you will aggregate the demand across multiple days and say that you will deliver …
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Service Output Demands and Sales Channel Design
Channel design is a crucial element in any product's marketing plan. It is sometimes the most crucial factor for success. A channel designed properly will bring in customers and increases your market share. Most of the times a channel is designed by the marketing teams and the structure and the maintenance is done by the …
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Inventory Management, Inventory Costs, Newsvendor vs. EOQ
Different models are used to manage inventory for products that are continually available (like milk) or products available for limited time (like seed).The Economic Order Quantity (EOQ) model determines the least cost level of inventory to carry, as well as costs. News Vendor models are used for products only available for a single period. EOQ …
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How Price Undercutting happens via Wholesale Trade?
Wikipedia defines price undercutting as: 'Price cutting, or undercutting, is a sales technique that reduces the retail prices to a level low enough to eliminate competition'. It is obvious that price under-cutting happens mostly to boost volume sales. This article is about how undercutting works in the context of Indian FMCG. Brief Overview of the …
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Wholesale market in India
Wholesellers are none but middlemen who buy products from distributors (wholesale/retail) and sell them to retailers. In most cases, the retailers come to the wholesellers to buy products to replenish their stock. However, wholesellers may also sell to end consumers, but such sales are minimal. In the Indian FMCG market, we have broadly two types of wholesellers: 1. …
Impact of GST on Supply Chain
To understand how Goods and Services tax (GST) will help companies optimize their supply-chain, one needs to understand a little bit taxation and the existing warehouse strategy. Let us take the example of a company whose manufacturing facility is present in Delhi, and it moves its goods down to South India. As the company sells …
FMCG Distribution Network
The typical chain for a grocer store FMCG product will be: Manufacturing plant -> Company Ware House -> Regional Ware House -> Regional Stockist or Depot -> Super Stockist or Depot -> Stockist/Depot -> Distributor -> Retailer Main Godown -> C&F Agents/Super Stockists -> Distributors as per the territories -> Wholesalers/Retailers So, the retailers either …
Link between SCM and Finance Management
In many companies, financial, information and physical flows are often not synchronised. Managers take ecisions from an operational or financial point of view and do not recognise the impact of supply chain management on financial performance or vice versa. Growth, profitability and capital utilisation are better optimised through information, financial and physical supply chains integration. …
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