How does supply chain management affect the company economy?

Supply chain management (SCM) is the management of the flow of goods and services and includes all processes that transform raw materials into final products.

Along with the management of the movement of goods and services it also involves managing the movement and storage of raw materials, work in progress inventory, finished goods right from point of origin till consumption. SCM has been defined as the design, planning, execution, control, and monitoring of supply chain activities with the objective of creating great products. Their objective is creating net value, building competitive infrastructure, leveraging on logistics, synchronizing supply with demand and measuring performance globally.

As we can see SCM is the lifeline of any organization and having a good SCM team is inevitable. SCM is the way the company can boost its economy and become more productive. Here are a few benefits of having a good SCM team:-

1. Higher efficiency rate.

2. Lower inventory, transportation, warehousing, and packaging costs.

3. Greater flexibility and streamlining of the supply chain.

4. Achieve a balance between cost and service provided.

5. Improve relationships between buyers and suppliers.

6. Easy analysis of demand and supply.

7. Improves customer service.

8. Increased performance and profitability.

9. It lowers delays in processes.

10. Gain loyalty of customers, stakeholders, and employees.

In addition to the above benefits having a good SCM, the team has other advantages too. It improves collaboration with suppliers. It improves the quality of your products. It reduces hidden costs. It ensures to keep up to customer’s expectations. It ensures to keep a loyal customer base. It helps to attract more customers. It provides security for investors and stakeholders. It creates room for new marketing opportunities.

Thus as we can see SCM is crucial for any organization and having a dedicated team to perform all its operations is essential. SCM plays a huge role in the company’s economy and has a positive influence on its revenue and profits.