CHAPTER 9.THE SUPPLY CHAIN

Supply chain management involves all movement and storage of raw materials, work-in-process inventory, and finished goods from point-of-origin to point-of-consumption. The supply chain business process includes: manufacturing, warehousing, transportation, customer service, demand planning, supply planning, and supply chain management. It is made up of the people, activities, information, and resources involved in moving a product from its supplier to the customer.

The structure of the supply chain organization is dependent on the industry as well as the size and complexity of the company. Some companies will not have a supply chain organization if their revenue is based only on services and not material product.

Supply chain management can be a tremendous asset for companies because it can reduce costs, improve the profit margin, and offer a better return on investment.1

Inventory control and inventory visibility are two very critical elements since these are the cost drivers and directly impact the bottom line in the balance sheet. Every business has a standard for inventory turnaround that is optimum for the business. Inventory turnaround refers to the number of times the inventory is sold and replaced in a period of 12 months. The health of the inventory turn relates to the health of business. Chapter 9 includes the following topics:

Chapter 9. The Supply Chain
Logistics
Reverse Logistics
The Role of Finance in Supply Chain Management

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