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CHAPTER
SUPPLY CHAIN AND CHANNEL MANAGEMENT
15
McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.
15-2
LEARNING OBJECTIVES
Supply Chain and Channel Management
LO1Define supply chain managementLO2Recognize the value added by the
supply chain.LO3Describe the flow of merchandise
and the flow of information in the supply chain.
LO4Describe how supply chains are managed.
15-3
Zara
Zara Website
Royalty-Free/CORBIS Royalty-Free/CORBIS
15-4
Supply Chain Management
15-5
Supply Chain, Marketing Channels, and Logistics are Related
Chad Baker/Getty Images
Ryan McVay/Getty Images
15-6
Behind the Scenes at Costco
15-7
Supply Chains Add Value
15-8
Supply Chains Streamline Distribution
FedEx Commercial
©Brand X Pictures/PunchStock
15-9
Supply Chain Management Affects Marketing
Courtesy Zara International, Inc. Courtesy Zara International, Inc.
15-10
1. How does supply chain management add value?
Check Yourself
15-11
Making Information Flow
15-12
Data Warehouse
15-13
Electronic Data Interchange
Ph
oto
by C
ab
ela
’s
15-14
Vendor-Managed Inventory
DH Kong/Plush Studios/Getty Images
15-15
Collaborative Planning, Forecasting, and Replenishment
Digital Vision/Getty Images
15-16
Pull and Push Supply Chain
15-17
1. What are the various supply chain links associated with each information flow?
2. What is the difference between push and pull supply chains?
Check Yourself
15-18
Making Merchandise Flow
15-19
Bakery with Conscience
15-20
How does Dell’s Merchandise Flow
Courtesy Dell, Inc.
15-21
Distribution Center versus Direct Store Delivery
Mario Tama/Getty Images
15-22
The Distribution Center
ABC News Segment on a Walgreens Warehouse
15-23
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
15-24
Receiving and Checking
David Buffinton/Getty Images
Photo by Scott Olson/Getty Images
15-25
Storing and Cross-Docking
Walter Hodges/Digital Vision/Getty Images
15-26
Getting Merchandise Floor-Ready
15-27
Shipping Merchandise to Stores
• Shipping merchandise to stores is complex for multi-store chains
• Distribution centers use sophisticated routing and scheduling systems
Ryan McVay/Getty Images
15-28
Inventory Management Through Just-In-Time Systems
Just-in-time (JIT)Just-in-time (JIT) Quick response (QR)
Quick response (QR)
Zappos Website
Cou
rtesy
Tu
bu
lar
Ste
el, In
c.
15-29
Benefits of JIT Systems
James Leynse/Corbis
15-30
1. How does merchandise flow through a typical supply chain?
2. Why have just-in-time supply chain systems become so popular?
Check Yourself
15-31
Managing the Marketing Channel and Supply Chain
Supply chain or channel conflict
Supply chain or channel conflict
Cou
rtesy
Th
e S
tan
ley W
ork
s
15-32
Managing the Marketing Channel and Supply Chain through Vertical Marketing
Systems
Independent or conventional supply chain
Independent or conventional supply chain
15-33
Types of Vertical Marketing Systems
15-34
Managing Marketing Channels and Supply Chains Through Strategic Relationships
15-35
Relationship of supply chain members
Use
d b
y P
erm
issi
on
of
Deu
tsch
In
c as
Ag
en
t fo
r N
ati
on
al Fl
uid
Milk
Pro
cess
or
Pro
moti
on
Board
15-36
1. What are the differences between the three types of vertical marketing systems?
2. How do firms develop strong strategic partnerships with their supply chain partners?
Check Yourself