Making money as a successful business is about more than just creating an interesting or desirable item. Getting the products, in the right quantities, to the appropriate consumers at the perfect moment is a complex dance that needs to be just right in order to earn a business maximum profits. According to the Mays Business School of Texas A&M University, "Supply chains include all the activities that must take place to get the right product into the right consumer’s hands in the right quantity and at the right time." Here are the various steps of supply chain management that get the right products into the right hands.
This is the first step in supply chain management. Business owners need to find a niche and think of a product that will fit that niche. They will then need to research the field and decide if a demographic or consumer field exists. If a product idea tests well and financial backing can be procured, the item can progress through to the next stage of the supply stage.
This is the stage where creators and business owners focus on transforming an idea for a product into a functioning item that could potentially be sold. It might start with a rough prototype, and panels of potential consumers will likely be brought in to critique or suggest changes. An important part of this process is also determining a price point for sale, and finding the right suppliers and products to create the product as affordably as possible. Only if the product can make a profit it will it be manufactured en masse.
Although this may be a major part of the supply chain, it is a relatively straightforward process. Typically the major decisions have already been made, and products are simply produced. Barring any employment issues, raw material shortages or machinery breakdowns, the manufacturing stage should progress without a hitch.
Advertisement and Marketing Stage
This stage of the supply chain involves targeting customers and informing them about the product. Advertising and marketing is vital in order to get the products into the right hands. Social media and internet marketing is now a leading way of attracting customers, and more than 70 percent of companies utilize this formally in order to advertise their new products.
Delivery, Logistics and Customer Service Stages
These final stages involve coordinating delivery of the product to the right stores, warehouses and cities to sell as quickly as possible. Customer complaints and returns also fall into this category, as they will need to be dealt with in order to improve company reputation and image.
The supply chain is a complicated process that leads from the creation of an idea to the selling of a final product. By understanding the entire chain, businesses can better oversee each stage and anticipate upcoming events along the way.