24 Nov Everything you need to know about Supply Chain

Everything you need to know about Supply Chain

Even today, there are still those who confuse supply chain and logistics. If you also have your doubts on this subject, then this article is for you!

What is the Supply Chain??

Supply Chain can be defined as a system that connects people, organizations, activities, information and resources involved in transporting the product or service from suppliers to the final destination, customers.

Managing the supply chain correctly and effectively is a major challenge for companies, requiring a lot of planning, given its importance and impact on results.

This planning, however, does not refer only to the processes already predefined and expected. It is also necessary to be aware of changes in customer behavior, climate change, or any other factor that may hinder the smooth functioning of the supply chain.

A curiosity that you may not know: everything around us and in our lives comes from a supply chain. Our food, cars, beds and everything. Without a good supply chain management, the world practically stops.

Difference between Logistics and Supply Chain

In summary, we can say that logistics refers to transportation and storage, while supply chain has to do with all aspects of procurement and supply.

Supply chain management is responsible for issues such as deposits, purchases, inventories, among others. Logistics, on the other hand, is a step in the supply chain, related to physical handling and delivery time, and it can be outsourced.

In logistics, the following tasks are included:

• Incoming transportation;
• Storage;
• Outbound transport;
• Execution;
• Reverse logistics.

On the other hand, Supply Chain involves:

• Purchasing / acquisition;
• Supply planning;
• Demand planning;
• ERP;
• Inventory management;
• Continuous improvement;
• Manufacturing.

Did you see how the confusion between the two doesn’t make a lot of sense? Just to memorize it: logistics is a process within supply chain, and supply chain is a system of actions ranging from the acquisition of raw materials to the distribution of the final product.

Responsive Supply Chain and Efficient Supply Chain

Still within the supply chain, there are these two “subdivisions”. Let’s see what each one means:

A responsive supply chain is one that meets your customers’ demand as soon as something is requested. It may, however, lead to an increase in expenses, making the chain less efficient.

Now, the efficient supply chain is the one with better production and cost management, with a greater focus on value. Depending on the demand for products, one or the other may end up being more effective.

If you are interested in the subject, I can already say that it is worth researching and learning more about, even so that you can work on this within your company, reducing costs, improving the flow between you and your customers, your position on the market, among many other advantages.