What is the performance of the supplier chain?
The performance of the supplier chain is the material control process to ensure that the supplies are accepted if necessary to support production operations. Effective supply chain management allows organizations to increase the turnover and revenue of inventory and at the same time reduce the trunks of cash flows. The performance of the supplier chain includes awarding public contracts, transport and receiving goods. While planning a supply chain, marketing determines the amount of products expected within a given time frame. The Main Planning Group will load demand into the company's planning system (ERP), resulting in purchasing requirements. The purchase request documents the number of components that the buyer must buy, and also if necessary components.
The buyer orders parts from suppliers upstream. Many organizations use the public procurement method (JIT) just-in-time (JIT), which plans to have material on site only if necessary. This may require daily or weekly supplies in z zImplitude on the manufacturing process. The advantages of the JIT method include the less desired warehouse space and less cash tied in the inventory. The disadvantage of the JIT method is, if there is an unforeseen problem with delivery, such as weather delay, production is closed due to insufficient materials available.
Transport is another process in carrying out the supplier chain. Professionals of logistics work with the network of the supply chain to ensure that the lean supply chain methods are used. Agreements are usually signed between the company and its suppliers, so there are agreements on the methods and fees for sending. Instead of the unit price of the component, the total landing costs are considered. This ensures that supplies are made to minimize transport costs.
Total landing costs is a term used to describe the actual cost to get part of the theSupplier to the destination. In addition to the actual unit prices of part, the total cost of landing and obligations such as import or customs duties includes. The total landing costs also include transport. In determining the best method of carrying out the supply chain, transport is often a large decision -making factor. For example, transport air can be the fastest way to receive parts, but costs are often several times more than an ocean or land.
Receiving the goods is the next step in performing a supplier chain. When the components arrive at the device, it is a key destination to store parts. In order to maximize stock turnover, many companies have accepted the strategy of managed inventory (VMI) managed supplier. For VMI components, parts are actually managed by the supplier, but are physically in place.
The seller usually has a person or group placed in place and accepts the material only when planned to be used. This method is particularlyBenefit for supplies and cash flow of flow when expensive material is used, for example in car manufacturers. For example, when motors are supplied by car manufacturers using the VMI method, the company does not have to require an inventory in its books until the engine is actually delivered to the production line.