The supply chain industry is the backbone and an integral element of a nation’s economy. An efficient and properly structured supply chain infrastructure helps lower manufacturing costs and boosts customer experience and satisfaction. Apart from these, it also enhances the ease of doing business and accelerates urban and rural consumption growth driven by better market accessibility. As a result of the COVID-19 pandemic, an air of uncertainty currently looms over the Indian economy. Now, businesses have to consider a lot of other factors before proceeding with activities like India sourcing and others.
In 2020’s second quarter, India witnessed only 4.5% yearly growth, the slowest rate in six years. The last time the nation saw such poor economic growth was in 2013. The situation is further affected by declining consumer confidence and growing financial burdens. The supply chain segment has a direct bearing on all other operational sectors within the economy. Hence, failures or even disruptions in the supply chain can have a tremendous negative effect on every aspect of the economy. Therefore, the supply chain stakeholders need to recognise the major challenges and form effective strategies to overcome them. As the country prepares to move past this downward trajectory, it becomes vital to strengthen the supply chain infrastructure.
For a long time, the Indian supply chain industry’s biggest challenges have been the high cost of raw materials, long infrastructural constraints, poor risk management, inadequate tech support, and incompetent professionals. Thanks to the increasing influx of both domestic and foreign capital, the government’s efforts in enhancing the supply chain infrastructure, and rising awareness among leaders of the significance of supply chain management, the future certainly looks brighter. A business’s survival in the current economic scenario and dynamic market depends not only on new and effective business strategies but also vastly on supply chain management.
Understanding the Value of Supply Chain Management
Supply chain management is an elaborate system that companies use across sectors to manage the different processes involved between manufacturing and delivering the product to the consumer. Its core components include resource acquisition, creation, inventory management, and demand and supply management, among others. The system aims to align end-to-end business processes in a strategic way. It helps companies understand the market value, and they also gain an edge over competitors.
With changing customer expectations, businesses must blend IT with logistics and supply chain for better coordination with their different aspects, right from sourcing and development to reach the customer. They must prioritise supply chain management, as it can help maintain a balance between the demand and supply in an economy. Supply chain management optimises a business’s operational productivity and efficiency for quick deliveries and better customer satisfaction.
How is Supply Chain Management Beneficial to an Organisation?
● Lowers Operational Costs
An efficient supply chain management system facilitates India sourcing and lets businesses quickly procure resources. They can then develop products timely and release them to the market, thus avoiding the unnecessary accumulation of products in their inventory. When the structure operates the best way, it helps businesses save both money and time. Through this system, companies can ensure that their products reach the market on time and eventually the customers, without any delay. Supply chain management thus helps firms meet their goals while maximising customer satisfaction.
● Boosts Financial Performance
Firms value supply chain managers as they use their knowledge and skills to assess performance, reduce supply chain costs, optimise processes, shorten the product life cycle, manage inventory, and recognise new opportunities to maximise profits. Also, they ensure that all capital assets like plants, equipment, and machinery are optimally used. It helps balance costs and output. Additionally, supply chain managers play another crucial role in an organisation. They establish and maintain good relationships between the different parties involved. It includes manufacturers, distributors, vendors, stakeholders, etc. All of these actions help enhance productivity and grow ROI substantially.
● Empowers People Working in the Supply Chain Structure
A supply chain system consists of several levels of varied elements. It includes an area’s transportation services, logistics, manufacturing, vendor-buyer relations, and physical infrastructure like highways, roads, railroad networks, etc. Hence, every tier of the supply chain network involves skilled workers. Their livelihood depends on the supply chain’s effective functioning. When there is a well-designed supply chain structure in a country, it sustains the people associated with its operation and lets them develop the correct skillset and domain knowledge. As they grow and upgrade their expertise, the nation’s supply chain structure further strengthens and expands.
● Improves Customer Services
The main goal is to deliver the right items to the customers as per their demands and at the correct location and time. For example, if a customer bought three products from a firm but received just two right items and one wrong product after the allotted delivery date, the customer will be unhappy. When such things happen, customers tend to contact the firm for support services. Firms with an excellent sales chain management system can handle customer complaints, requests, or queries timely. It helps them get loyal customers.
● Creates Job Opportunities
Supply chain management has a broad scope. A typical Indian supply chain encompasses aspects such as, India sourcing, manufacturing, storing, packaging, transportation, IT, logistics, etc. Thus, it creates various job opportunities across multiple sectors. A supply chain management’s most promising job titles include Production Planner, Production Manager, Logistics Resource Planner, Maintenance Supervisor, and more. In India, supply chain management is considered the new rage in the industrial scenario. The ever-growing product variety, increasing proliferation of foreign players in the Indian market, shortened product life cycles, and fast-paced digitization are the principal driving factors behind the increasing scope of supply chain management in India.
These are a few reasons why Indian firms should embrace supply chain management. First, they must contact a prominent procurement firm for the best India sourcing and then use the supply chain management system to fulfill their business goals.