The importance of supply chain management - Essay Example

? Supply Chain Management [Institute’s Supply Chain Management International trade has resulted in the movement of goods acrossthe globe. Faster communication has enabled many companies to remain largely competitive, by delivering customized products on time. International trade relies much on the supply chain, which largely encompasses the distribution of goods to the final consumers, through different processes of distribution. Supply chain management, therefore has become an important topic of concern for many companies, who rely on getting a huge market for their highly competitive products. Supply chain management helps in the proper management of resources and a far more efficient way of distribution (Jesperson & Larsen 2005, p. 9). Supply chain management is a fast and emerging concept in the distribution of goods in supermarkets. Huge international corporations such as Dell, Kodak, Gillette, Unilever and Wal-Mart have all introduced SCM (Jesperson & Larsen 2005, p. 10). Therefore, I, as an SCM consultant have been asked to analyze the supply chain management of the fashion department of the Co-Op supermarket, and address and provide a few solutions to the concerns of the board of directors, which are quite valid. Fashion has an allure for many women in the United States. Therefore, the fashion department of the supermarket has done quite well. However, with the recent awareness of the problems of environment, many women have become largely concerned about the origination of these fashion products. Hence, supermarkets are faced with a dilemma. They have to remain competitive, offer low prices to customers and respond to certain other needs of customers, quite unrelated to the specification of the product, itself. The Supply Chain Management is an issue of such vital importance because the globalized world that we live in, has spurred off many benefits, as well as many problems. Market segmentation has occurred, where many consumers may become concerned with the environment. Co-op supermarket has an ethical policy, which takes many preferences of the consumers. Customer responsiveness is quite significant; therefore, consumer feedback has to be integrated into daily operations (Wisner, Tan & Leong 2008, p. 26). The board of directors has become increasingly concerned over the channel of distribution of the fashion products, since they are manufactured in China, and are shipped across the globe to the United States. The concern is quite logical and merits consideration. According to Wisner, Tan and Leong, in their book “Principles of Supply Chain Management”, the greening of supply chains is important, because they suit the particular needs of the customers, especially in the case of Co-Op supermarket. Code of ethics is an important component of the workings of the Co-Op supermarket, the company prides in it. Therefore, ethical policy needs revision if the customer preferences have to be catered. The book mentions that the entire chain of distribution from storing, packaging, repackaging, transit and delivery have a significant threat to the environment. The threat to the environment comes in the form of air pollution, congestion, global warming and other forms of industrial pollution. In the case of shipment, whether by air or by sea, pollution is created, which inevitably leads to Global Warming. The fashion products can also be not manufactured in the United States, since the production can become highly expensive, because of expensive labor. However, products in China are manufactured quite cheaply. Therefore, even at the cost of ethical policy, the supermarket cannot forgo its competitiveness in the market. Moreover, the supermarket cannot only stock products from the native country, because this denies consumer the choice and variety of different products. Therefore, the supermarket is faced with a dilemma. If it is to maintain a market of the fashion products, it needs to address the concerns of many consumers who like to preserve the integrity of the environment. Therefore, competitiveness and profit maximization has not remained the only goal of the supermarket. According to a study, around 75% of consumers in the United States state the environmental reputation of the company has a wide impact on their buying decisions (Wisner, Tan & Leong 2008, p. 26). Marketing plays a major role in maintaining the company’s reputation in the market. We, from the Co-Op supermarket can commit ourselves to many of the plans, undertaken by major power players in the market, such as Wal-Mart. We can release less air pollution and contribute less to global warming by doubling the fuel efficiency of our shipping and air fleets, which carry our products. The example of Wal-Mart can help us in this regard, since it implemented an environmental program, which included cutting energy, using renewable energy and using efficient fuel in the fleets. This endeavor gave the reputation of the Wal-Mart an incredible boost, which can happen to our supermarket, as well. Moreover, some people would be willing to buy eco-friendly products at a higher price. It is the job of the marketing department to find segments in the population, which will be willing. The Supply Chain Department can line up many eco-friendly fashion products, manufactured in the United States or nearby locations, to avoid the environmental impacts of shipping. In this way, consumers are also not denied the choice of many fashion products. In fact, the most specific of consumer preferences are targeted in this way. Just as The Body Shop has infiltrated the market with natural and organic beauty products, people will be willing to pay more for an eco-friendly product. In addition, the supermarket can focus on other environmental areas, such as using recycled packaging materials, in order to give a positive environmental image of the country. The Co-op supermarket will become a responsible business in this way and responsible businesses attracts the best people. Moreover, the mode of transportation needs consideration. Transport through sea has a lower carbonic impact on the environment. However, sea transport should only be used if the delivery and consignment is huge and does not include delicate items. A proper trade off, hence is important. A number of companies have taken the step to make their ethical policy more environmentally friendly. There is a vital need for this, because consumers’ preferences have altered to include such problems of the environment, as well. A green supply chain has therefore gained importance for many supermarkets, including Co-Op, the strategies outlined above ought to help the supermarket maintain competitiveness and offer choice to consumers, while considering environment. References Jesperson, B. D., & Larsen, T. S. 2005. Background. Supply chain management: in theory and practice (pp. 9-10). Oxfordshire: Copenhagen Business School Press. Wisner, J. D., Tan, K., & Leong, G. K. 2008. Supply Chain Management- An overview. Principles of Supply Chain Management (p. 26). Mason: Cengage Learning Press. Read More