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CHAPTER Day 19 BUS 222
Agenda • Questions? • Assignment 6 Due • Quiz 5 is Today (30 min) – Chaps 13& 14 – 10 M/C questions, 1 extra credit for 5 points – 30 Min. , open book, open notes • Begin Discussion on Supply Chain and Channel Management (45 min)
Rest Of Semester Schedule • April 14 – Chapter 16 • April 17 – Chap 17 • April 21 – Quiz 6 ( Chap 15 & 16) – Chap 18 • April 24 – Chap 18 • April 28 – Chap 19 – Assignment 7 Due • May 1 – Quiz 7 (chaps 17, 18 & 19) • May 5 @ 10 AM – Marketing Plan Presentations • May 7 @Midnight – Marketing Plans due
CHAPTER SUPPLY CHAIN AND CHANNEL MANAGEMENT Mc. Graw-Hill/Irwin 15 Copyright © 2012 by The Mc. Graw-Hill Companies, Inc. All rights reserved.
Supply Chain and Channel Management LEARNING OBJECTIVES LO 1 Define supply chain management LO 2 Recognize the value added by the supply chain. LO 3 Describe the flow of merchandise and the flow of information in the supply chain. LO 4 Describe how supply chains are managed.
Zara Royalty-Free/CORBIS Customers Zara Website
Source: http: //cmuscm. blogspot. com/2012/09/fashion-forward-zaras-supply-chain. html
Supply Chain Management
Supply Chain, Marketing Channels, and Logistics are Related Marketing channel Logistics management Chad Baker/Getty Images Similar but different Ryan Mc. Vay/Getty Images
Behind the Scenes at Costco
Supply Chains Add Value
Supply Chains Streamline Distribution Reduce number of transactions Increase value for consumers More efficient and effective ©Brand X Pictures/Punch. Stock Fed. Ex Commercial
Supply Chain Management Affects Marketing Fulfilling delivery promises Meeting customer expectations Reliant on an efficient supply chain Courtesy Zara International, Inc.
Check Yourself 1. How does supply chain management add value?
Making Information Flow
Electronic Data Interchange (EDI) Photo by Cabela’s Cycle time Easily analyzed and used Quality of communications
How EDI works Source: http: //www. edibasics. co. uk/what-is-edi/how-does-edi-work/
Vendor-Managed Inventory DH Kong/Plush Studios/Getty Images
Collaborative Planning, Forecasting, and Replenishment (CPFR) http: //www. businesswire. com/multimedia/home/20040518005256/en/1088537/VICS-CPFR-Moving Digital Vision/Getty Images
Pull and Push Supply Chain Pull • Orders based on sales data • More accurate inventory • Better when demand is uncertain Push • Merchandise allocated based on forecast • Does not need sophisticated IT system • Good for steady demand items
Check Yourself 1. 2. What are the various supply chain links associated with each information flow? What is the difference between push and pull supply chains?
Making Merchandise Flow
How does Dell’s Merchandise Flow Courtesy Dell, Inc.
Distribution Center versus Direct Store Delivery What are the advantages of a distribution center? Mario Tama/Getty Images
http: //www. forte-industries. com/client-stories/bdf-beiersdorf. aspx
The Distribution Center Management of inbound transportation Receiving and checking using UPC and RFID Storing and Cross-Docking Getting Merchandise Floor Ready Preparing to ship Shipping to store ABC News Segment on a Walgreens Warehouse
Inbound Transportation • Dispatcher coordinates deliveries • Manufacturer may pay transportation expenses or retailers may negotiate directly with trucking companies and pay expenses Steve Cole/Photodisc/Getty Images
Receiving and Checking Receiving Arrival receipt Checking Undamaged Radio Frequency Distribution (RFID) Tags Container computer chips David Buffinton/Getty Images Ordered = received Photo by Scott Olson/Getty Images
Storing and Cross-Docking Traditional Cross-docking Combinations Walter Hodges/Digital Vision/Getty Images
Getting Merchandise Floor-Ready Ticketing and marking Increasingly firms are forcing suppliers to ship floor ready merchandise
Shipping Merchandise to Stores • Shipping merchandise to stores is complex for multi-store chains • Distribution centers use sophisticated routing and scheduling systems Ryan Mc. Vay/Getty Images
Courtesy Tubular Steel, Inc. Inventory Management Through Just-In-Time Systems Just-in-time (JIT) Quick response (QR)
Benefits of JIT Systems Reduced lead time James Leynse/Corbis Increased product availability and lower inventory investment
Check Yourself 1. 2. How does merchandise flow through a typical supply chain? Why have just-in-time supply chain systems become so popular?
Courtesy The Stanley Works Managing the Marketing Channel and Supply Chain Supply chain or channel conflict
Managing the Marketing Channel and Supply Chain through Vertical Marketing Systems Independent or conventional supply chain
Types of Vertical Marketing Systems Independent or conventional supply chain Administered vertical marketing system Contractual vertical marketing system Corporate vertical marketing system
Managing Marketing Channels and Supply Chains Through Strategic Relationships Common Goals Open Communications Mutual Trust Interdependence Strategic Relationships Credible Commitments
Used by Permission of Deutsch Inc as Agent for National Fluid Milk Processor Promotion Board Relationship of supply chain members
Check Yourself 1. 2. What are the differences between the three types of vertical marketing systems? How do firms develop strong strategic partnerships with their supply chain partners?