Supply chain management includes all the activities that must take place to get the right product into consumer’s hand in the right quantity and at the right time, also from raw materials extraction to final purchases. Supply Chain management focuses on planning and forecasting, purchasing, product assembly, moving, storage, distribution, sales and customer service. SCM is the active management of supply chain activities to maximize customer value and achieve a sustainable competitive advantage. The organizations that make up the supply chain are ’linked’ together through physical flows and information flows. Physical flows are the most visible piece of the supply chain but just as important as information flow. Physical flows involve the transformation, movement, and storage of goods and materials. Information flows allow the various supply chain partners to coordinate their long term plans, and control the day to day flow of goods and material up and down the supply chain.
We can describe the product attributes of tires by quality, brand, price and life-cycle. Understanding which product attributes are values to customer are vital. When customers are purchasing a product, they tend to look at attributes first as their priority. Retailers must also know what exactly the values are, and then they will be able to optimize the assortment. In short, product attributes will determine the demand from customer. Forecasting plays a huge role in supply chain implications, because knowing what the values are, will create a more accurate forecast, lead to a more solid production plan. Moreover, by using data from customers, retailers can minimize the product SKU, and still maintain high customer service. In short using the accurate product attributes to optimize assortment, will maximize sales and profit; if we do not know what customer wants and needs, production plan will mess up, and also lead to high SKU in retailer
An organization with a solid supply chain network allows them to draw a big picture of their material and information flow, allow them to see the movement of material and information from start to end, foresee the value in creating partnership and working together to provide best value to customers. Sephora planned their supply chain network adequately by understanding their network flow, thus create the optimal solution. Uncertainty always arise in a supply chain network, therefore all parties should monitor markets conditions and respond appropriately through improved supply chain strategies (Hanfield). The factors that are important while evaluating a supply chain network are location,