Importance of an effective supply chain

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  • Importance of an effective supply chain
    • Stock control
      • Computerised stock controll
        • If a business sells high volumes then they need to ensure they are refilling their stock
      • JIT storage
        • Reduces the need for much storage space, which can be expensive
      • Stocked at busy periods such as Christmas
        • They can cope with demands from customers, and have good customer satisfaction
      • JIC storage
        • Businesses can cope with the increase in demand, and be able to meet it
      • Stock rotation
        • This reduces waste, as allows customers to get the freshest goods
    • Procurement
      • Delivery time
        • If it takes too long, the customer may not be able to buy that product, so go elsewhere
      • Reliability of supplier
        • If the supplier doesn’t deliver on time, the customer may not be able to buy that product
      • Cost
        • If the products cost too much, prices will be too high in the shop
      • Reputation of supplie
        • If the supplier has a bad reputation, then the customers will have a negative experience
      • Payment terms
        • If they cannot meet the payment terms, then the supplier will stop providing to them
      • Sustainability and fair trade
        • Custimers may look for this when buying their products
    • Logistics
      • Transport raw materials
        • Raw materials need to be at the factories at the right time, so manufacturingcan take place
      • Transport finished goods
        • Products need to be at the right place at the right time, to ensure they are available for customers
      • Delivers the right products to the right place
        • If it takes too long, the customer may not be able to buy that product, so go elsewhere

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