Emerging Key of Supply Chain Trends

The importance of supply chain management and efficiency is reflected the growing levels of investment in this area. A number of drivers can be identified that are core to this investment emphasis, these are:

• Globalization of markets, manufacturing and distribution businesses are increasingly relocating manufacturing facilities to places of lowest cost of production. These facilities, remote from major markets, require distribution to be capable of linking any point to any point globally in the service of the world market

• Shifting demand patterns rapid shifts in taste, fashion and overall demands means that supply chains have to be capable of ensuring efficiencies are maintained in a dynamic environment via all channels of trade.

• Service fulfillment is a key differentiator. The supply chain has to be able to rapidly trade off overall efficiency with maintaining service levels. This flexibility impacts inventory and transportation choices in a dynamic way.

• High market share not high margin is important efficiencies gained in production, distribution and new market access provide increased levels of consumption with more flexible margin management.

• Rapid entry of new competitors. The ability of new competitors to leverage information and customer market access in support of new business models is forcing traditional companies to engage in rapid supply chain upgrades and strategies focused on supply flexibility.

The ultimate achievement of addressing these trends is that a business can dynamically achieve the lowest cost position in regards to production, focus distribution to provide the lowest time to consumer at the lowest cost, increase efficiency with each trade cycle and provide response to market better than traditional or emerging competitors. Information is replacing inventory. Companies competent in the management of the entire information resource from initial customer contact to the points of fulfillment and post sales support have less inventory costs. Information replaces inventory as the process becomes integrated to a single flow from raw material through production and distribution plus post sales support of the end use