{"id":41574,"date":"2023-01-19T20:05:55","date_gmt":"2023-01-19T14:35:55","guid":{"rendered":"https:\/\/www.techtricksworld.com\/?p=41574"},"modified":"2024-02-12T21:51:39","modified_gmt":"2024-02-12T16:21:39","slug":"supply-chain","status":"publish","type":"post","link":"https:\/\/www.techtricksworld.com\/supply-chain\/","title":{"rendered":"How Does a Supply Chain Work? A Simple Guide"},"content":{"rendered":"<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-41576\" src=\"https:\/\/www.techtricksworld.com\/wp-content\/uploads\/2023\/01\/supply-chain.jpg\" alt=\"Supply chain\" width=\"1000\" height=\"341\" srcset=\"https:\/\/www.techtricksworld.com\/wp-content\/uploads\/2023\/01\/supply-chain.jpg 1000w, https:\/\/www.techtricksworld.com\/wp-content\/uploads\/2023\/01\/supply-chain-990x338.jpg 990w\" sizes=\"(max-width: 1000px) 100vw, 1000px\" \/><\/p>\n<p><span style=\"font-weight: 400;\">The <a href=\"https:\/\/en.wikipedia.org\/wiki\/COVID-19_pandemic\" target=\"_blank\" rel=\"nofollow\">COVID-19 pandemic<\/a> brought to the forefront a term many people had heard of, but most did not understand: the supply chain. We quickly learned how important a functional and efficient supply chain is as we were faced with empty grocery store shelves and delayed deliveries. Some goods, such as hand sanitizer, paper towels, and toilet paper, were impossible to find, or if you could find them, you had to pay significantly more \u2014 even if you were settling for an off-brand.\u00a0\u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">If you\u2019ve read a <\/span><a href=\"https:\/\/argano.com\/2021\/06\/24\/50-best-supply-chain-blogs-for-supply-chain-news-trends-and-insights\/\" target=\"_blank\"><span style=\"font-weight: 400;\">supply chain management blog<\/span><\/a><span style=\"font-weight: 400;\"> lately, you know that a supply chain is a very complex collection of logistics processes that must work together to succeed. In this article, we\u2019ll provide a simple explanation to give you a foundation of understanding.<\/span><\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title \" >Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.techtricksworld.com\/supply-chain\/#What_Is_a_Supply_Chain\" title=\"What Is a Supply Chain?\">What Is a Supply Chain?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.techtricksworld.com\/supply-chain\/#How_a_Supply_Chain_Works\" title=\"How a Supply Chain Works?\">How a Supply Chain Works?<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.techtricksworld.com\/supply-chain\/#Supply_Chains_within_Supply_Chains\" title=\"Supply Chains within Supply Chains\">Supply Chains within Supply Chains<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.techtricksworld.com\/supply-chain\/#Methods_of_Delivery\" title=\"Methods of Delivery\">Methods of Delivery<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.techtricksworld.com\/supply-chain\/#Supply_Chain_Disruptions\" title=\"Supply Chain Disruptions\">Supply Chain Disruptions<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.techtricksworld.com\/supply-chain\/#Final_Thoughts\" title=\"Final Thoughts\">Final Thoughts<\/a><\/li><\/ul><\/nav><\/div>\n\n<h2><span class=\"ez-toc-section\" id=\"What_Is_a_Supply_Chain\"><\/span><span style=\"color: #000080;\"><strong>What Is a Supply Chain?<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<hr \/>\n<p><span style=\"font-weight: 400;\">At its most basic, a supply chain is a process of moving goods from point &#8220;A&#8221; to point &#8220;B.&#8221; While commerce is the typical supply chain application, supply chains also exist in military and government processes, manufacturing, construction, telecommunications, and other industries.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Goods can include finished products, parts, raw materials, or anything else that needs transporting from one point to another as part of an organizational structure.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">For example, every vehicle starts as a set of raw materials. Those raw materials are mined and transported to processing plants and then to parts manufacturers. The parts get moved to the manufacturer of the vehicle. Once the vehicle is manufactured, it is transported from the manufacturer to the sales center.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">A customer purchases the vehicle at that point, and the supply chain is complete.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Every industry is impacted by the supply chain in some way. If you work in an office, for example, shortages of printer ink and printer paper could be a concern.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">When demand for a product is greater than the available supply, it drives prices up. So you could end up paying twice as much for your printer ink and printer paper, which would have an impact on your overhead costs and your bottom line.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">These impacts might be minimal compared to a shortage of essential products like masks and <a href=\"https:\/\/www.who.int\/teams\/health-product-policy-and-standards\/assistive-and-medical-technology\/medical-devices\/ppe\" target=\"_blank\" rel=\"nofollow\">personal protective equipment<\/a> (PPE). As we experienced, PPE shortages posed significant challenges at the height of the pandemic. Essential healthcare workers were forced to reuse PPE and make do with protective gear that didn\u2019t meet the usual requirements.\u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Now that we\u2019ve illustrated the importance of efficient supply chains, let\u2019s take a closer look at how a supply chain works.\u00a0<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"How_a_Supply_Chain_Works\"><\/span><span style=\"color: #000080;\"><strong>How a Supply Chain Works?<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<hr \/>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-41575\" src=\"https:\/\/www.techtricksworld.com\/wp-content\/uploads\/2023\/01\/how-supply-chain-works.jpg\" alt=\"how supply chain works\" width=\"1000\" height=\"469\" srcset=\"https:\/\/www.techtricksworld.com\/wp-content\/uploads\/2023\/01\/how-supply-chain-works.jpg 1000w, https:\/\/www.techtricksworld.com\/wp-content\/uploads\/2023\/01\/how-supply-chain-works-990x464.jpg 990w\" sizes=\"(max-width: 1000px) 100vw, 1000px\" \/><\/p>\n<p><span style=\"font-weight: 400;\">Within every supply chain, there are many moving parts. Each part contributes something to moving a product from point A to B. Within each supply chain, there are:<\/span><\/p>\n<div class=\"su-list\" style=\"margin-left:0px\">\n<ul>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">Manufacturing processes<\/span><\/li>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">Warehousing and storage<\/span><\/li>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">Transportation methods<\/span><\/li>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">Compliance measures<\/span><\/li>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">Packaging<\/span><\/li>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">Ordering processes<\/span><\/li>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">Scheduling<\/span><\/li>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">Distribution networks<\/div><\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">For example, in a <a href=\"https:\/\/www.techtricksworld.com\/tips-to-grow-your-online-retail-store\/\" target=\"_blank\" rel=\"noreferrer noopener\">retail setting at a department store<\/a>, finished goods are purchased from manufacturers and shipped to distribution points or shipping companies. The products then get distributed and transported via plane, trains, and trucks to various points of manufacture or distribution.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The supply chain comprises the processes that work together to bring goods to market. Production, manufacturing, marketing, and merchandising schedules manage those processes. Each works together to get what is needed to its proper destination and ultimately in the hands of the end consumer as smoothly and quickly as possible. Based on my experience, a delay or disruption at any stage of the supply chain has downstream effects with potentially significant consequences.\u00a0<\/span><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Supply_Chains_within_Supply_Chains\"><\/span><strong>Supply Chains within Supply Chains<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Within every supply chain, there are several waypoints and micro-supply chains. These waypoints have benchmarks, schedules, logistics, and management challenges and processes.\u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">For example, that provider of raw materials takes an order or fulfills a production goal and ships its product to specific locations that use those materials to manufacture parts for a product. The parts manufacturer sends the parts to the product manufacturer, and so on.<\/span><\/p>\n<p>Within each of those steps are individual schedules, transportation processes, and other logistics that each play a role in a <a href=\"https:\/\/www.coupa.com\/products\/procurement\/purchase-requisition\" target=\"_blank\">comprehensive system<\/a> and must be worked out for the system to work.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Methods_of_Delivery\"><\/span><strong>Methods of Delivery<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Supply chains run on a method of delivery. Many products utilize several delivery methods throughout the manufacturing and distribution process. Any goods you purchase likely traveled via a\u00a0 combination of planes, trains, trucks, and ships at some point in their delivery cycle.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">For instance, most products coming from overseas are shipped to ports in the USA and unloaded. They are transported by truck or train to individual supply companies or distribution points. From there, the products are transported by truck or train to a collection point, usually put on trucks and delivered to distribution centers or retail outlets.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">While cost is the driver for most transportation processes, speed also <a href=\"https:\/\/www.techtricksworld.com\/how-business-intelligence-influences-the-decision-making\/\" target=\"_blank\" rel=\"noreferrer noopener\">influences the decision<\/a> to use one mode over another. Some transportation processes have faster alternatives, like using a plane to bring goods from China, but the cost is prohibitive, which makes ships a better, albeit slower alternative. In my experience, it\u2019s often a matter of finding the right balance between cost and efficiency.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">When we face higher costs to procure raw materials or transport goods, the choice is either to accept the increased overhead and reduced profit margin or pass the higher costs on to the consumer. This is a key driver of rising costs for goods.\u00a0\u00a0\u00a0\u00a0<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Supply_Chain_Disruptions\"><\/span><span style=\"color: #000080;\"><strong>Supply Chain Disruptions<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<hr \/>\n<p><span style=\"font-weight: 400;\">We mostly hear about supply chains when they are disrupted. Supply chain disruptions can happen for a variety of reasons, including, but not limited to:<\/span><\/p>\n<div class=\"su-list\" style=\"margin-left:0px\">\n<ul>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">Bad weather and natural disasters<\/span><\/li>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">Lost merchandise because of accidents on the road, rails, or at sea<\/span><\/li>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">Worker issues like strikes, work slowdowns, or staffing shortages<\/span><\/li>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">Dramatic increases in demand that exceed supply<\/span><\/li>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">Gluts in offloading at transportation or distribution points<\/span><\/li>\n<li><i class=\"sui sui-check\" style=\"color:#35921c\"><\/i> <span style=\"font-weight: 400;\">World events, such as a global pandemic<\/div><\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">When a disruption happens, most companies have contingencies. However, you must have a contingency plan for every possible scenario. If the disruption causes enough delay, a product&#8217;s availability decreases, driving higher costs.\u00a0\u00a0<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Final_Thoughts\"><\/span><strong>Final Thoughts<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Virtually everything you buy has a supply chain that takes it from raw materials to the finished product you are purchasing. Along the way, in most cases, multiple cycles, processes, and schedules worked together to keep delivery on time.\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The COVID-19 pandemic brought to the forefront a term many people had heard of, but most did not understand: the supply chain. We quickly learned how important a functional and efficient supply chain is as we were faced with empty grocery store shelves and delayed deliveries. Some goods, such as hand sanitizer, paper towels, and [&hellip;]<\/p>\n","protected":false},"author":12,"featured_media":41576,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2699],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.7 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>How Does a Supply Chain Work? A Simple Guide<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.techtricksworld.com\/supply-chain\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How Does a Supply Chain Work? 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