In this report, the system approach is applied in order to manage the complexity within Fast Moving Consumer Goods (FMCG) division of Spencer’s retail ltd. The main focus has been on the supply chain management of the retail organisation. …
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The firm that is analyzed in the paper is Spencer’s retail ltd that is carrying out its operations in nine different geographical regions and has a portfolio of around 200 stores. The retail organisation offers wide variety of products and items to its customers including FMCG, clothing, food items, grocery, etc. Along with this the company is sourcing all items and products from 3000 suppliers all over the country. All of this requires well planned and executed supply chain management strategy. Supply chain management is essential in order to make sure that the organisation is able to fulfil the needs and requirements of the customers while achieving a strategic fit between the organisation’s competitive strategy and supply chain strategy. There are six drivers of supply chain which should be managed effectively and efficiently. These six drivers are: Facilities, Inventory, Transportation, Information, Sourcing, and Pricing. Also, supply chain management is directly related with other operations and departments of the organisation and there should be integration among them. The most important element in this regard is the inventory management. Almost all retail organisations strive hard to achieve the optimal quantity of the inventory at stores and at distribution centres in order to avoid the situation of stock out and also to avoid excessive stocks of inventories. As, stock out leads to unsatisfied and thus lost customers and the excessive stocks also results in increasing the storage and inventory cost. Spencer’s retail ltd is also making all efforts in order to avoid stock outs and reduce the overall inventory storage and holding cost. Spencer’s Supply chain Model: The supply chain model of Spencer has been described on the basis of responsibilities of different teams: Category Team: Category team is an important part of the Spencer’s supply chain model and it is the responsibility of the category team to deal and formalise the terms and conditions and all types of contracts with the suppliers. Negotiation as well as screening of products to select the products are also the responsibility of the category team. The whole process of the supply chain of Spencer work in harmony and in a team as the category team sends information to the buying team regarding
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