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Supply chain management is the network management of the business which is interconnected and involved in the procedure of product and service packages which are required by the end customers.
Braun Company is the company which manufactures and deals with the products like electric shavers, hair trimming, beard trimming etc. S 50 was the first electric shaver of this company but it was not so popular because of World War 2. (Epsicom Business Intelligence, 2010)
Logistic is one of the part of supply chain management that helps in planning, implementing and also in controlling the effective and efficient flow of products. Storage of goods and services and sending of information from one point to the point of consumption for the customer's comes under logistics. According to the traditional view logistics in the manufacturing firm includes profit percentage of 4%, logistic cost is around 21%, marketing cost around 27% and manufacturing cost around 48%. Logistics helps the Braun Company by movement and storage of goods and services like electric shavers etc and this is the fact that Braun Company has grown rapidly.
In Braun company the logistic method controls the whole cost of the business and also on the flexibility and the performance of the company. The main thing about logistics is that it costs account for between 5% to 35% of the total amount of sales costs and it also shows the biggest cost in the international market. So logistics play a very important role in the company Braun as it deals with the products and services which needs proper management.
SUPPLY CHAIN MANAGEMENT:
Supply chain management helps in managing the supply of goods and services as well as it helps in the saving of cost. It is estimated that the company like Braun Company for electric shavers etc could save up to $25 billion by using the supply chain strategies in the correct manner. For example when the new electric shaver was launched by Braun they estimated that around $60 million was saved by collaboration which results in the match of supply and demand perfectly. The main aim of using chain management in the Braun Company is the fulfilling of the needs of the customer directly or indirectly. So without the supply chain management Braun Company couldn't save the cost of supply. The main objective that is fulfilled by supply chain management in Braun Company is the maximization of the overall value that is created. Supply chain management finds the difference between the cost in satisfying the need of the customer and the net profit that got from the customers. The Braun Company uses the supply chain management to correlate value to the SC profitability. One of the examples that show the magnitude of SCM in traditional view is that grocery industry could save $30 billion with the use of effective supply chain strategies.
There are three phases of supply chain and they are SC strategy, SC planning and the last is SC operation. All the three stages are required for fulfilling customerâ€™s request. Some strategic SC decisions include the location and facilities capacity, modes of transportation etc. Supply chain planning helps the Braun company by the set of policies which helps in governing short term operation. Planning includes the markets, planned buildup and inventory policies. SC operation includes the implementation of the operating policies like short term or long term effectively. The most commonly used measure in all operation management is Inventory Turnover.
In a supply chain, all the steps taken for moving and storing a product from the stage of supplier to the stage of customer is known as distribution. In the Broun Company also the main thing is the distribution of products and services for the use of customer's. Various factors like cost and the customer's experience are dependent on the process of distribution and which finally drives profitability. The Braun Company focuses very well on the distribution process of products like electric shaver etc and thus drives the profitability. The choice of the network of distribution achieves the supply chain objectives from the lower cost to the higher responsiveness. The most important thing to know is that the number of facilities is inversely proportional to the response time. The design options for distribution network include manufacturer storage with direct shipping and also the In-Transit merge and distributor storage with Last mile delivery. These options are used by Braun for the distribution network
There are two dimensions at the highest level which are always followed by the Braun company are:
Needs of the customer that is met.
Cost of meeting the needs of the customer.
So the distribution system depends on the customer service and the cost required providing the high level of service.
DEMAND AND CUSTOMER SERVICE:
As the competition is increasing day by day the improvement in the demand management is very important. Braun Company uses the sales and operation planning software and some other systems also for building the better plan of consumer service but in today's competitive environment the plans will never be completely right. So the Braun Company should keep in mind this thing and now must combine planning of the demand with the capacity of strategies for responding the daily challenges in the sales and operation horizon. For the management of demand and customer service the Braun Company is driving the profitable responses demand shaping and quick allocation of the goods supply accordingly. With the increase in inventory cost the number of facilities also increases. Braun Company has no problems of demand and their management of customer service is also good up to a certain limit but they need more management for customer service. (Improve Demand Management and Customer Service to Drive Revenue Growth, 2010)
One of the tool which helps in chain supply management and the whole company of Braun is the decision rights tools as this tool helps in the enhancement of processes, products and services which helps in increasing the profit for the company. Network optimization model in Braun Company provides the allocation of demands to production facilities and also in allocating capacity. The other model is demand allocation model which provides answer of which markets served by which plant and also about the supply sources of plant. (The tools)
One of the graph that show the supply chain management is
PROBLEMS AND OPPORTUNITIES OF BRAUN COMPANY:
There are some problems which are faced by the Braun Company and they all are related with the management of supply. The company sometimes lack in satisfying the needs of the customer and this is because they don't have perfect management skills or they are not able to apply those skills in their work. For example few years ago the Braun Company got the order of electric shavers and this order was very huge but the company failed to deliver the demand at the time to the customer due to which they suffered a great loss. So this company faces the problem of customer service management. This company has great opportunities at present and also in future as the electric shavers by them have very unique features which others don't have.
The products of the Braun Company have unique features but the company should remove the problem of managing them. They are more dependent on the software like sales and planning software but nowadays they don't help much so the company should bring in the new softwareâ€™s and the most important recommendation is that they should make a separate team for the purpose of managing the supply only. Braun Company must combine planning of the demand with the capacity of strategies for responding the daily challenges in the sales and operation. By following these recommendations, the Braun Company will reach the heights because they have so many capabilities.