What is a supply chain and what are its characteristics?

The supply chain is a functional network of suppliers, manufacturers, distributors, and end-users that is organized around a core enterprise, starting from supporting parts, making intermediate and final products, and finally delivering the products to consumers through a sales network.

Supply chain system refers to the integration of key business processes and relationships of enterprises along the entire chain from the initial material supplier to the end-user in order to provide goods, services or information to the end-user.

Supply chain management is a business philosophy that seeks to optimize the supply chain as a whole from the consumer's point of view through collaboration among enterprises. Successful supply chain management coordinates and integrates all activities in the supply chain into a seamless, integrated process.

Supply chain is through the planning (Plan), get (Obtain), storage (Store), distribution (Distribute), service (Serve) and so on such activities and the formation of a kind of interface between the customer and the supplier (Interface), so that the enterprise can meet the internal and external customer demand.

Expanded Information:

Supply Chain Generally Includes the Material Circulation, Business Circulation, Information Circulation, Capital flow of four processes:

1, material flow

This process is mainly the circulation of materials (goods), which is a program to send goods. The direction of this process is directed from the supplier to the consumer via the manufacturer, wholesale and logistics, and retailers. The material process has been widely emphasized because business theories have long been centered on physical products. Many logistics theories deal with how to get goods out of the material flow process in a short period of time and at a low cost.

2, commercial circulation

This process is mainly the circulation process of buying and selling, which is the commercial process of accepting orders, signing contracts and so on. The direction of the process is in the two-way flow between suppliers and consumers. The form of commercial circulation tends to diversify: both the traditional store sales, door-to-door sales, mail order, and through the Internet and other emerging media for shopping in the form of e-commerce.

3, the flow of information

This process is the flow of goods and transaction information. The direction of the process is also in the two-way flow between suppliers and consumers. In the past, people tend to focus on seeing the physical, and thus the flow of information has been neglected. Some people even think that the country's logistics backwardness and they put too much money into the material process and delay the grasp of information is not unrelated.

4, the circulation of funds

This process is the circulation of money, in order to protect the normal operation of the enterprise, must ensure that the timely recovery of funds, otherwise the enterprise will not be able to establish a sound business system. The direction of the process is by consumers through retailers, wholesale and logistics, manufacturers, etc. point to the supplier.

Baidu Encyclopedia - Supply Chain