How Does Integrated Supply Chain Help Retail Enterprises

How Does Integrated Supply Chain Help Retail Enterprises

By: Retail CIO Outlook | Friday, September 27, 2019

Integrated supply chain allows the company to streamline the entire system starting from procurement of raw materials to production, and eventually to delivery. The companies will have the entire control over the integrated process allowing them to act rapidly while making any decision.

FREMONT, CA: Traditionally, the supply chain management (SCM) has always followed a siloed structure, which makes it challenging to keep an account of all the trade-offs in demand and supply planning. This usual process of the supply chain is reactive and lacks flexibility, adaptation, and sense, which ultimately exposes the company to demand instability. On the other hand, modern-day technologies have allowed many teams to share an integrated view of operations, that will enable them to make plans, according to the highest net value for the organization. The optimization creates a difference of opinion among the leaders and slacker.

Supply chain, integrated logistics, and product innovation strategies, irrespective of the industry, are functions that are necessary to create the value within an organization's operation. To achieve agility and innovation, the company must apply the three services and make them work together.

There are also many advantages of having an integrated supply chain.

1. Stay on Top of Demand

The companies will be at a better position to predict and act accordingly with integrated logistics, product innovation strategies, and supply chain. In this technology motivated world, the global supply chain needs to work quickly and accommodate emerging markets, fluctuating economies, and shorter product life cycles. The integration of innovation with logistics and effective supply chain management is one of the ways that can ensure whether businesses are effectively responding to the changes in demand or not.

2. Flexibility

One of the significant benefits of the integrated supply chain is its increased flexibility. According to business researchers, by combining all the business functions, organizations can achieve flexibility.

The tight supply chain integration gives management the operational flexibility through which they can rapidly respond to any external events, such as the changes in consumer demand or actions of the competitor. It will become easy for companies to gather intelligence from the supply chain about their competitors and take steps in advance.

3. Eliminate Waste

It is not easy to maintain a sustainable supply chain. The lean practices in supply chain management can help in identifying and eliminating waste. The elimination of waste will also increase agility, which will allow the organizations to respond effectively to any unpredictable situations. Therefore, practicing the combination of the agile and lean supply chain is the preferable option. To make sure the supply chain is sustainable and prosperous in the long run, the companies must integrate data from different operations.

4. Higher Profit Margins

The previous three benefits will lead the company to a higher profit margin. If the supply chain is well organized, it will become more comfortable for the companies to maintain and increase their revenue, ensuring higher profits. Efficiently managing a collaborative and innovative supply chain with the help of product and portfolio management software and SCM solutions will help the businesses to produce and deliver products at a faster and successful rate, thus attaining higher profit margins.

However, it is up to the company to decide how to utilize the benefits and overcome the challenges in the market.

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