The supply chain is the basis of a company's logistics, regardless of the profile of its business and customers. In this article, we explain what a supply chain is and what it means.

What does it mean supply chain?

What is a supply chain?? We can say that supply chain is an extremely extensive process. Concept supply chain it is so broad that it cannot be described in just a few words. Supply chains it is a whole sequence of events, it is also a process of movement of goods. Main reason supply chain is to meet the demand for a given product. We can say that supply chain is a network of organizations involved in the process and is characterized by extensive connections with suppliers and recipients. The activities they conduct create value, which is the product and service provided to consumers or end recipients.

You may wonder about this what is a supply chain. It is certain that this process consists of a network of plants, enterprises and manufacturers, as well as contractors who, firstly, supply raw materials and components, and secondly, process them into components and semi-finished products. And then, these semi-finished products and components are used to produce a final product that reaches the consumer. It is also worth knowing that the basic elements supply chain are transport and storage. They are what enable and facilitate deliveries.

With a concept supply chain Logistics are also involved. You should know that logistics is a so-called subordinate concept supply chain. This is because logistics only cover a small part supply chain.

We present three basic features associated with supply chain. They are:

• subjective structure – these are the entities that participate in supply chain,
• object of flow – all types of materials and products processed and then transferred by others supply chain elements,
• Objectives – these are the activities and areas of cooperation of entities that participate in supply chain.

 What does it consist of supply chain? three elements should be mentioned:

•  company
•  suppliers
•  customers

It is worth knowing that there are extensive ones supply chains. So v within the supply chain extensive functions:

•  suppliers suppliers,
•  clients clients,
•  companies that provide logistics, financial, marketing and IT services.

You should also be aware that in within the supply chain we distinguish the following processes:

•  development,
•  production,
•  sales,
•  service,
•  supplies,
•  resource management,
•  distribution,
•  all kinds of supporting activities. 

What do we distinguish? types of supply chains? Supply chain covers the entire product life cycle. This includes sales, after-sales service, as well as disposal. In other words, it is this value chain. The supply chain consists of all the elements and values ​​that a given company transfers to the market and society. There are two parts supply chain. The first is the upper part of the supply chain - from the manufacturer through first- and second-tier suppliers to the company. The second one is the lower part of the supply chain. It runs from the company through distributors and sellers to the consumer.

There is also sustainable supply chain. What is? These are all types of business activities that cover the product life cycle. They allow for the creation of value for all parties to the contract and ensure commercial success. This, in turn, affects social well-being and the condition of the natural environment. 

Another kind supply chain jest green supply chain (responsible supply chain). Characteristic sustainable supply chain is that its process includes the so-called ideas of green operations and green design, as well as green production. This model also features reverse logistics and waste management. IN green supply chain it is important to strive to maximize profits, but in a different way than in traditional ones supply chains. In this case, all activities are aimed at reducing the consumption of natural resources and energy. Participants green supply chain they also try to reduce pollutant emissions. These are activities typical of responsible companies. 

What are the goals supply chain?

It can be said that the basic purpose of introduction supply chain management there are financial benefits, which is simply money. This is because each innovative solution is associated with savings for the company and its financial profit. Improvements introduced related to chain management supplies they give companies the highest return. This is because it is possible to reduce the cost of goods sold. Including logistics, production, methods obtaining raw materials, transformation of raw materials, storage of goods or transport, as well as all kinds of fees and labor costs amount to up to 80% of sales costs. Therefore, if this percentage drops even slightly, this state of affairs will have a huge impact on the company's profitability, and it already has crucial meaning for a given enterprise. This allows achieve better financial results.

What are the goals supply chain management? There are 5 main management goals supply chain, they are:

• creating effective cooperation that will enable automatic coordination of logistics on the part of suppliers and buyers,

• providing end customers with valuable and high-quality products, 
• attention to long-term stabilization and sustainable development. In this process, an important role is played by planning and implementing each activity in an optimal manner, i.e. starting from the material acquisition cycle to the order cycle. These activities are carried out to meet the needs of consumers,
•  anticipating and then exploiting potential opportunities and threats.
•  enabling success and mitigating financial risk by reducing or leading to cost reduction – are also important storage costs products, labor and logistics that need to be reduced. In this process, it is also necessary to increase sales; market availability and product differentiation play an important role. 

What is supply chain management?

Let's think about what it is effective supply chain management. It can be said that at the first and basic level, effective supply chain management is based on management flow of goods, data and financial resources that are directly related to products or services. In this case, the time period covers the moment from the purchase of raw materials until the delivery of the product to the destination (until end customer).

Supply chain is often confused with logistics. And it is only one of the elements supply chain. Any operations that take place within supply chain include:

•  ordering,
•  product life cycle management,
•  planning supply chain along with supplies and maintenance of company resources,
•  logistics, which includes transport and fleet management,
•  order management.

 Moreover, with the concept supply chain management The management of global suppliers, as well as all types of production processes on an international scale, is also directly related.

The primary goal of management supply chain is to reduce the company's costs and increase efficiency. Nowadays, it is the customer who decides on setting management priorities by providing companies with experience.

Currently, customers only attach themselves to the company that is able to respond quickly and efficiently customer expectations. Therefore, all deliveries of raw materials, and then production, logistics and sales of products, as well as the management of acquired orders, must work together and be well coordinated. Only then will the customer receive what he expects within a time frame acceptable to him. Nowadays, companies have to analyze in some way supply chains from the consumers' point of view. Only then will it be this effective supply chain.

Just like today's world, so too supply chains are now very complex and still developing. Efficiency supply chains depends on flexibility. This is because customers have a wide range of choices and various purchasing options. They can freely purchase products in stationary stores and online. Customers are now focused on personalization and only contemporary flexible supply chain can provide this to them.

As the world moves forward, sourcing continues to evolve and is now extremely fluid. The ability to flexibly, quickly and smoothly reconfigure supply chains is very important. As you can see, flexibility plays a key role in this process. 

The fundamental issue of business management is supply chain management. Modern companies do everything to be able to cooperate with each other, because only such cooperation increases efficiency and allows reducing the costs associated with running a company. This approach to business also allows us to adapt to customer needs. Below we present the elements necessary for management supply chain:

•  location of warehouses and production plants,
•  transportation,
•  storage,
•  resource and inventory control,
•  information, especially its collection, processing and transmission (information flow),
•  emphasis on marketing and customer service,
•  a well-thought-out strategy for managing packaging and leftovers.

Moreover, in supply chain management the following methods are used:

• LM – slimming management,
• QR – quick response,
• AM – flexible management,
• TQM – comprehensive quality management,
• BPR – involving the redesign of a business process,
• TBM – i.e. time management,
• six sigma,
• ECR – effective service in supply chains consumer,
• JiT – i.e. delivering goods exactly on time,
• SCOR – which is the reference model supply chain,
• VMI – supplier inventory management.

Every time management supply chain is tailored to the enterprise. Nowadays, it is impossible to imagine a company's operation without it effective supply chain. It is the essence of the logistics of every enterprise, regardless of the company's profile and regardless of the profile of its customers.