SCM Lowdown

Latest Trend in Global Supply Chain Management

With the shift and change in International scenario of business infrastructure and strategy, the Global Supply Chain Management does also requires change in its basic tenants and procedural application to accommodate itself with running trend and regularly with international standards and norms.

There are many policies which adopted, radically, can bring about big changes in international scenario of Supply Chain Management. In the series, the first one is:

Implementation of Time Bound Strategies Based on Collaboration: Collaborative Planning, Forecasting and Replenishment (CPFR) is a new standard as employed by suppliers and retailers to improve forecasting and bring out the best while through the replacement of products. This is thus more focused on to integrate and reduce uncertainty and increases products supply. Quick response is a strategy adapted to give instant results in just-in-time strategies to the retail sector. This is quite different to traditional supply chain with an advanced design cycle and a lengthy manufacturing and shipping cycle.

Zara is enlightenment to the supply chain manufacturers as in Spain, they, merely take 10 to 14 days to design; produce and deliver produce garments to retail store, instead of 3 to 4 months for its competition.

Change in Pattern for Customer’s Demand: With the span of time, the customer’s priority is also changing with span of time they have started asking for on time delivery with variety of products and packaging with increased level of quality as well.

Influence of Global Sourcing: Lower Production or purchasing cost as due to under impact of Global Sourcing has certain increased costs is supply chain like transportation, warehousing and inventory costs. You will get gateways congested as well that will complicate the matter even more and for worse. According to a survey, only 42% of Canadian companies earned profit while outsourcing to production to China.

Role of Third Party Logistics:  With changed International Scenario the Value-added distribution centers have become talk of the time. They can do all pick and pack, labeling, kitting, special packaging or co-manufacturing. The market share of Third Party Logistics has risen over to $ 10 billion in 1990 to around $ 120 billion in 2007.

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