chapter fourteen supply chain and channel management Mc

chapter fourteen supply chain and channel management Mc. Graw-Hill/Irwin Copyright © 2013 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

Supply Chain and Channel Management LEARNING OBJECTIVES LO 1 Define supply chain management LO 2 Recognize the value added by the supply chain. LO 3 Describe the flow of merchandise and the flow of information in the supply chain. LO 4 Describe how supply chains are managed. 14 -2

Supply Chain Management 14 -3

Supply Chain, Marketing Channels, and Logistics are Related Marketing channel Logistics management Chad Baker/Getty Images Similar but different Ryan Mc. Vay/Getty Images 14 -4

Supply Chains Streamline Distribution Reduce number of transactions Increase value for consumers More efficient and effective ©Brand X Pictures/Punch. Stock Fed. Ex Commercial 14 -5

Supply Chain Management Affects Marketing Fulfilling delivery promises Meeting customer expectations Reliant on an efficient supply chain Courtesy Zara International, Inc. 14 -6

Data Warehouse 14 -7

Electronic Data Interchange Photo by Cabela’s Cycle time Easily analyzed and used Quality of communications 14 -8

Vendor-Managed Inventory DH Kong/Plush Studios/Getty Images 14 -9

Collaborative Planning, Forecasting, and Replenishment Digital Vision/Getty Images 14 -10

Pull and Push Supply Chain Pull • Orders based on sales data • More accurate inventory • Better when demand is uncertain Push • Merchandise allocated based on forecast • Does not need sophisticated IS system • Good for steady demand items 14 -11

The Distribution Center Management of inbound transportation Receiving and checking using UPC and RFID Storing and Cross-Docking Getting Merchandise Floor Ready Preparing to ship Shipping to store ABC News Segment on a Walgreens Warehouse 14 -12

Inbound Transportation • Dispatcher coordinates deliveries • Manufacturer may pay transportation expenses or retailers may negotiate directly with trucking companies and pay expenses Steve Cole/Photodisc/Getty Images 14 -13

Receiving and Checking Receiving Arrival receipt Checking Undamaged Radio Frequency Distribution (RFID) Tags Container computer chips David Buffinton/Getty Images Ordered = received Photo by Scott Olson/Getty Images 14 -14

Storing and Cross-Docking Traditional Cross-docking Combinations Walter Hodges/Digital Vision/Getty Images 14 -15

Shipping Merchandise to Stores • Shipping merchandise to stores is complex for multi-store chains • Distribution centers use sophisticated routing and scheduling systems Ryan Mc. Vay/Getty Images 14 -16

Courtesy Tubular Steel, Inc. Inventory Management Through Just-In-Time Systems Just-in-time (JIT) Quick response (QR) Zappos Website 14 -17

Types of Vertical Marketing Systems Independent or conventional supply chain Administered vertical marketing system Contractual vertical marketing system Corporate vertical marketing system 14 -18

Managing Marketing Channels and Supply Chains Through Strategic Relationships Common Goals Open Communications Mutual Trust Interdependence Strategic Relationships Credible Commitments 14 -19