Logistics and Supply Chain Management - Term Paper Example

Logistics and Supply Chain Management Course: Institution: Date: Table of Contents Table of Contents 2 1.0 Introduction 3 2.0 Manufacturing 4 2.1 Clothing Industry 4 2.2 Food Industry 5 2.3 Aviation Industry 6 3.0 Distribution 6 3.1 Clothing Industry 7 3.2 Food Industry 8 3.3 Aviation Industry 8 4.0 Power Dynamics 9 4.1 Clothing Industry 10 4.2 Food Industry 10 4.3 Aviation Industry 11 5.0 Conclusion 12 References 13 Appendices 14 Appendix 1: The Clothing Industry sales 14 Appendix 2: Aviation Industry Global Demand 15 1.0 Introduction Macro environmental factor changes in the market have increased in the recent past. In this regard, unlike the traditional market set up that had relatively stable market operations and external factors the global current market platform is gradually and regularly changing due to changes on the international front. Lamb, Hair, McDaniel (2012) stated that this is based on changes on the political, social, economic as well as technological. As such, organisations across the global industries have resulted to the application and adoption of alternative competitive edges development that are not only competitive in the short run period but also sustainable in the long run period. In this regard, the traditional competitive edges factors such as large capital bases and economies of scale have declined over the years due to increased globalization and capital sources availability. One of the commonly applied competitive edges across the industries is the concept of logistics and supply chain management. On one hand, logistics in information is described as the flow of materials and information across the organisations from the suppliers all through to a products or service final consumers. On the other hand, supply chain includes all the stakeholders in the delivery of goods who have direct and indirect implications on products delivery. This report evaluates three industries namely the clothing, food industry and aviation industries application of supply chain management with respect to their manufacturing and distribution processes. Moreover, the report offers an evaluation of power dynamics in each of the industries logistics and supply chain management processes. 2.0 Manufacturing The manufacturing process in products and services delivery includes the actual development and production of the supplied products. In this case, the supply chain stage includes the process of acquiring raw materials, forms and types of manufacturing and production approaches used as well as the supply of the products from the manufactures to the market. This report section evaluates these variables application in each of the three discussed industries. As such, it evaluates their raw materials sourcing approaches, the manufacturing and production processes as well as their products supply systems respectively. 2.1 Clothing Industry The clothing industry relies on both natural and synthetic materials as the industry main raw materials. In this case, the industry stakeholders relate and establish relationships with the primary sources controllers in the market. In this case, the quality and value of the supplied raw materials in the industry vary especially based on region of origin. In this case, manufacturing organisations have direct relationships with the raw material producers and as such procure the goods directly from them to ensure increased on time delivery at reduced costs in the market. On the other hand, an evaluation of the manufacturing approach establishes that organisations conduct direct production approach. This implies that the various manufacturing organisations are directly involved in the production process. As such, the respective producers do not hire or contract third parties in the production and manufacturing processes. Indeed, as Graham (2005) argued, the manufactures have resulted to off shoring their manufacturing and production services to the raw material sources as a measure to reduce on the overall cost of production. In this regard, the off shoring practices by clothes industry manufacturers’ boats logistics in terms of transportation of the raw material that at times lower quality with increased delivery time such as cotton and wool. Moreover, this establishes a close communication link between the organisations and the suppliers due to access and availability ease. 2.2 Food Industry The food industry also described as one of the most developing markets is a mixture of both goods and services production in the market. On one hand, the production sector in the industry is involved with the production and manufacturing of food products in the market. In this case, the ingredients for manufacturing these food products, unlike in the clothes industry though readily available vary largely in quality and variety. As such, the industry manufacturers have developed suppliers’ portfolio. In this regard, instead of directly dealing with the numerous suppliers availing the diverse raw materials to the organisations, there are third party agents charged with the role and mandate of dealing and handling the respective suppliers on behalf of the food production organisations. This approach has a logistical benefit. In this case, on one hand, the approach reduces the organisations focus on suppliers’ management thus allowing increased time and funds towards the actual production processes. In addition, the approach increases supplier relationship through increased management and information flow between the suppliers and the third party agent who in most of the cases are experts in the procurement and logistics management field. On the other hand, the service sector under the food industry is charged with the provision of food related services such as serving among others. As such, this industry section has direct relationships with both its supplier and the consumers to ensure increased quality and customization. 2.3 Aviation Industry Unlike the clothing and food industries, the aviation industry operates under a different approach. As discussed above, both the clothing and food industries have numerous suppliers of the required raw materials, most of which are natural resources. However, on the contrary, the aviation industry has few suppliers. This is based on the fact that the required raw materials require high technical knowledge as well as high capital investments. In this regard, the industry has established a partnership approach in its manufacturing system. In this regard, the required products are often custom made to meet the respective consumer needs. Therefore, the manufacturing organizations have developed lose relationships through which the industry manufactures only manufacture products to order. Moreover, the expediting process is rigorous in that unlike in the other industries, the consumers are involved in the step by step process involvement through which they ascertain on the respective production process conformance to the specified process needs in the market (Vasigh, Mackay & Fleming, 2010). Therefore, information flow between the manufacturers and the consumers in the production is very high and frequent in the production expediting process. Moreover, supplier relationships are intense and closely knit as opposed to the other two industries discussed namely the food and clothing industry. 3.0 Distribution An additional aspect and component of the supply chain is the distribution aspect. In this regard, the distribution function emerges after the production function in the supply chain. In this case, the process involves the delivery of the respective developed products upon their manufacturing t the destined final consumers. As such, this involves the products delivery both to the customers and final consumers. This report section evaluates the distribution aspects of the clothing, food and aviation industries respectively. As such, the report section evaluates the distribution approaches and channel adopted by each of the industry stakeholders. 3.1 Clothing Industry The clothing industry as already discussed has a wide range of manufacturers. As such, the industry is characterized by a high number of manufacturers. In its distribution channels, the industry applies both the direct and indirect channels in the market. On one hand, the direct distribution channels in the market are adopted through the manufactures direct delivery of the products to the market. As such, the manufacturers have their own distribution outlets both physical and online. As such, Du (2013) argued that the direct distribution approach adopted by the clothes industry manufacturers increases their communication as well as information flow between the manufacturers and their consumers thus promoting brand identity and image. As such, the various manufacturers have adopted the direct distribution system as a marketing approach to create consumer relationships and loyalty in the market. On the other hand, the manufacturers apply the indirect distribution system. In this case, besides marketing under the respective brands, there are other distributers who offer the market increased variety. In this regard, the indirect distributors provide the clothes industry consumers with variety to choose between different industry fashions, quality and nature of the availed products. Therefore, this report evaluation report section establishes that the application and adoption of both the direct and indirect distribution channels increase the industry brands competitiveness and consumer relationships and loyalty simultaneously. 3.2 Food Industry The food industry is a joint goods and service delivery industry. In this case, for the service sector industry, the organization has adopted a direct distribution system. As such, the various services provide in the industry such as restaurants and fast food outlets such as McDonalds has over the years applied the direct distribution system. Through this approach the organisations manufacture respective customized foods and deliver them to the consumers through various global outlets as well as franchises. On the other hand, the industry applies external sourcing to facilitate distribution of the food products. In this case, the external service providers offer the organisations with transportation services to deliver products to consumers on time as well as safely and securely. In this case, the external providers offer a viable and affordable platform through which the highly volatile and perishable food products are availed to the consumers. Other distribution avenues and approaches in the industry include the use of industry partners. As such, organisations in the market have developed and established forward integration systems. As such, through the forward integration, organisations acquire willing distributors who represent and supply their products on an exclusive basis in the market, allowing for brand development and image promotion in the society. 3.3 Aviation Industry The aviation industry’s different from other global industries in many ways. As already established its manufacturing approaches and relationships differ as they are unique as compared to other discussed industries. Similarly, the distribution channels adopted in the industry as expected are unique. The aviation industry has two strategic arms and sectors namely the civilian commercial sector as well as the military combat sector. In this case, regardless of the sector, the industry is highly sensitive due to the high capital and technology requirements in the market. In this case, the industry applies the direct distribution channels. As such, the potential and prospective consumers in the industry procure and acquire the products directly from the manufacturers. The adoption of this strategic direct distribution approach in the industry has earned the industry a wide range of benefits (Schmid, 2011). One among them is the establishment of quality guarantee. In this regard, the elimination of brokers and other intermediaries in the distribution chain guarantees on products quality. Moreover, the reduction of the intermediaries in the supply chain enhances the reduction of the supply chain costs thus relatively reducing on the products costs in the market. 4.0 Power Dynamics Based o the above logistics and supply chain management discussed in the report, develops a strategic approach through which the respective industries have applied and adopted in its logistics system in the market. In this regard, the report section offers an evaluation on which among the discussed supply chain and logistics processes bears greater power in each of the industries namely clothing, food industry and the aviation. As such, the section seeks to outline the key emphasis areas in each of the industries outlining the reasons for each as well as developing a forecast on expected logistics and supply chain management approaches for each of the discussed industries. 4.1 Clothing Industry An evaluation on the clothing industry as developed in this report evaluates on the manufacturing and distribution logistics and supply chain management factors in the industry. On one hand, the evaluation establishes that there are many industry suppliers of the required raw materials as well as well industry manufacturers. On the other hand, the evaluation analysis on the industry distribution aspect establishes that increased market competition increases the need for the application of both the direct and indirect distribution channels in the market. Based on this review, this report concludes that the industry power is in the distribution aspects. This is mainly because of the high competition levels in the industry. As such, Rhodes (2005) stated that the industry has applied increased forward integration measures through which close partnerships are developed and maintained. In this regard, it is only organisations with high partnerships relationships and cordial working relationships with their respective distributors that have increased their overall market success. Therefore, this has necessitated increased investment by the manufacturers as well as distribution agencies in the market in a bid to raise increased capital for enhancing products supply and delivery efficiency in the market. Thus, this report evidences that the distribution supply chain aspect holds the power and much influence and control in the clothing industry supply chain. 4.2 Food Industry An evaluation on the food industry establishes two strategic revelations. On one hand, the evaluation reveals that the industry production and manufacturing process involves the development of supplier relationships through third party agents to ensure logistics on information and materials flow efficiencies. In addition, the evaluation on the distribution aspects evidences an increased direct delivery of the respective organizational products. Therefore, based on these reviews, this report concludes that the industry supply chain management and logistics power lies in the manufacturing function. On one hand, this is because of the level of high information flow that circulates between the food industry manufacturers and the suppliers. In this regard, quality of the raw materials as well as the increased delivery time constraints on delivery. Therefore, industry stakeholders have increased their focus and concentration into developing and facilitating increased system efficiency. On the other hand, the industry has a wide range of stakeholders in this supply chain stage, besides the suppliers, regulators and interest groups concerned with the production of quality and hygiene products exerts their influence. In this case, the process of materials testing and evaluation has gained increased publicity and attention from across the stakeholders (Kumar, & Anand, 1998). Therefore, based on this review on the amount of capital investments and number of involved stakeholder, the manufacturing stage posses the most power in the food industry logistics and supply chain management stages. 4.3 Aviation Industry On its part, an evaluation on the aviation industry evidences the low number of manufactures as well as suppliers in the industry and thus the development of high level relationships between the suppliers and industry manufacturers to enhance increased quality and efficiency. On the other hand, a distribution review evidences the direct distribution channels adopted by the industry manufacturers. In this regard, this report concludes that the most vital stage in the supply chain management is the manufacturing stage. In this regard, the aviation industry being a highly sensitive industry has high stakeholders’ involvement in the manufacturing process. As such, the high involvement of the consumers, suppliers as well as regulators in the manufacturing process increase the stage relevance. In this regard, the industry has minimal focus on distribution because most of the industry consumers relate and purchase customized products, thus reducing the role and relevance of the distribution stage. Therefore, instead of focusing on the forward integration strategies like the other discussed industries, it adopts the backward integration strategy. Therefore, this report concludes that the manufacturing aspect is the most relevant stage in the industries supply chain. 5.0 Conclusion In summary, this report offers a critical review of logistics and supply chain management in three different industries namely the clothing, food and aviation industry. In this regard, the report evidences that the clothing industry has its distribution aspects as the most dominant with evidenced forward integration strategies application. On the other hand, the food industry similar to the aviation industry has their greater supply chain management and logistics control on their manufacturing functions due to the high quality requirements. References Du, W. (2013). Informatics and management science IV. London: Springer. Graham, G. (2005). Exploring supply chain management in the creative industries. Bradford: Emerald. Kumar, C. G., & Anand, S. K. (1998). Significance of microbial biofilms in food industry: a review. International journal of food microbiology, 42(1), 9-27. Lamb, C. W., Hair, J. F., & McDaniel, C. D. (2012). Essentials of marketing. Mason, Ohio: South-Western Cengage Learning. Rhodes, E. (2005). Supply Chains and Total Product Systems: A Reader. Oxford: John Wiley & Sons. Schmid, V. (2011). Customer Relationship Management in the Airline Industry. München: GRIN Verlag GmbH. Vasigh, B., Mackay, L., & Fleming, K. (2010). Foundations of airline finance: Methodology and practice. Farnham: Ashgate. Appendices Appendix 1: The Clothing Industry sales Appendix 2: Aviation Industry Global Demand Read More