Advantages of Supply Chain Management :
- Supply Chain Management helps to achieve better inventory control.
- Supply Chain Management is used to get better control over suppliers.
- Supply Chain Management can increase market visibility.
- Supply Chain Management helps to increase savings in labour and procurement costs.
- Chances of product failure rate can be reduced by Supply Chain Management.
- Supply Chain Management is used to provide better information on customer needs, tastes etc.,
- Supply Chain Management helps to achieve regular and better communication with the customers.
- Supply Chain Management helps to improve customer care service.
- Supply Chain Management is used to achieve higher revenues.
- Supply Chain Management increases performance and profitability.
- Supply Chain Management is used to lower transportation, warehousing and packaging costs.
- Supply Chain Management increases capacity, capability or flexibility.
- Supply Chain Management enhance value for money.
- Supply Chain Management is used to improve reputation of brand in market.
- Supply Chain Management also increases the value of shareholder.
- Supply Chain Management is used for faster and more accurate order processing.
- Supply Chain Management allows higher discount on price to wholesaler due large order size.
- Supply Chain Management is also good for returns and recall management.
- Supply Chain Management is used for production tracking.
- Businesses can use SCM to build strong relationship and better collaboration with the suppliers.
- Quick production and delivery processes is possible because of this and hence it helps to bring product faster in market compared to competitors.
- It also reduces the legal issues, fines and product recalls due to non-compliance.
Disadvantages of Supply Chain Management :
- Sometimes Supply Chain Management can be very expensive to implement.
- Competitors can easily copy the strategy of Supply Chain Management.
- For better Supply Chain Management, proper skills and experience is required to achieve success.
- Sometimes in Supply Chain Management various functions may be difficult to manage.
- In Supply Chain Management there may be staff resistance.
Supply chain management involves organizations, people, procedures, packaging, purchasing, delivery, checking , warehousing etc. It also helps to maintain long term relatinship with the suppliers and the distributors.
Key business areas of supply chain management includes: Demand planning, customer servce, partnership, warehouse distribution, enterprise performance, order management and supply base management.