A reliable supply chain system is crucial to the smooth operation of any manufacturing facility, from the acquisition of raw materials to the shipment of finished goods to customers.

Phases in the supply chain network design, characteristics of the supply chain, and individual parts of supply chain management are only some of the many categories into which supply chain management can be broken down. Together, the four components of the supply chain—integration, operations, purchasing, and distribution—establish a cost effective and competitive route to market.

Service Supply chain: Overview
The section of the supply chain that is responsible for servicing items is called the “service supply chain.” It deals with the availability of resources for performing product maintenance and repairs in a timely manner.

Reverse logistics refers to the processes involved in receiving and processing returned products for maintenance, refurbishment, replacement, or recycling within the service supply chain. Third party logistics providers (3PLs) are frequently used by manufacturers to handle this facet of the service supply chain.

Components of Supply Chain:

1. Planning:
The procurement department of a corporation must choose between in house production of completed goods and the purchase of external raw materials. If the company is opting to buy finished goods instead, then the subject of whether or not they will be sourced domestically, regionally, or internationally becomes more pressing for management.

The answers to these questions depend on a wide variety of considerations. The two most crucial are the initial investment and the recurring costs of production or acquisition. Quality, speed, and availability are also important factors to think about.

A cost benefit analysis is the most reliable method for settling such questions. This will provide the organization a better idea of whether it is more cost effective to manufacture products in house or to get them from a third party.

2. Sourcing:
Once the initial component is finished, sourcing can begin. This step is essential since it has the potential to reduce costs significantly.

The key to effective corporate sourcing is finding a trusted supplier at a fair price who can meet your volume needs quickly. If you go with a shady vendor, it will have an adverse impact on the rest of your supply chain. As a result, you will need to do more than just locate potential suppliers; you will also need to assess and qualify them.

3. Inventory:
It may sound unusual, but we can learn a lot by looking at how purchasing and supply chain management evolved in the year 2020. The importance of having multiple suppliers to ensure a constant supply is emphasized. If, for any reason, Supplier A is unable to deliver on time, we may quickly switch to Supplier B and maintain adequate supplies.

Many companies have struggled in 2020, especially those that lacked adequate supplies. According to RetailNext’s poll, 28% of firms experienced shortages of essential supplies, forcing them to do without them or renegotiate contracts. Keeping production schedules and stock levels in sync with consumer demand requires expert knowledge and practice.

4. Manufacturing and Distribution:
Production, warehousing, and transportation are the subsequent pillars of supply chain management. To ensure smooth operations, businesses should routinely assess whether or not they are making the right number of items at the expected quality level.

Logistics for warehousing and delivering products to retail outlets fall under this category as well. When planning a supply chain, many managers overlook the significance of logistics planning until after they have already purchased the necessary materials.