Lecture 1 (Introduction to Supply Chain Management)

Question 1

Define the following E-commerce terms: B2B, B2C, C2C & C2B.

Answer 1

They are defined on the basis of whom the transaction occurs between.

• Business-to-Business (B2B): Both sides of the transaction consist either of the following: Businesses, Non-profit organisations or the government.
• Business-to-Consumer (B2C): Transaction is between a business and a consumer. Here the consumer/individual is purchasing a product or service from a business.
• Consumer-to-Consumer(C2C): Both sides of the transaction are consumers.
• Consumer-to-Business (C2B): Transaction is between a consumer and a business. Here a consumer/individual is selling a product or service to a business.

This course focuses only on B2C

Question 2

Define Supply Chain Management

Formal definition

Answer 2

Supply chain management is a combination of the following:
* Managing supply and demand
* Sourcing raw material and parts
* Manufacturing and assembly
* Warehousing and Inventory management
* Order entry and Order management
* Distribution across all channels
* Delivery to customers

Question 3

What are the Main drivers, Integration drivers, and Goal for SCM?

Answer 3

Main drivers: Transportation, Storage & Facilities
Integration drivers: Information, Sourcing & Prices
Goal: To achieve high service levels at low cost

Question 4

Explain the flow of product, cash and information in SCM

Answer 4

The flow of product, information and cash can be divided into 4 parts for SCM:
Product flow: This includes the transfer of product from the manufacturer to the customer as well as through the different stages of production of the product. It includes: raw materials, services, other components etc.

Reverse Product flow:Also known as “Reverse Logistics” this includes the returns received from customers for repair, recycling, disposal or a normal return. This part of the SCM flow has become increasing important over the years.

Information flow:This is another crucial part which is integral to the proper function of a SCM and includes receipts, crucial data needed for delivery, other paperwork, compliance related information, demand and supply info etc.

Product Cash flow:This is the exchange of money generally between the customer -> business for the product or service that was purchased. Important for the liquidity of a business.

Question 5

What is the key difference between Amazon & Alibaba in terms of SCM?

Answer 5

Alibaba:
* Solely a marketplace
* Doesn’t own inventory
* Doesn’t provide fulfillment services

Amazon:
* Primarily/Historically a reseller
* Owns large inventory
* Provides fulfillment services

Therefore they require different kinds of supply chains

Question 6

What are the different types of Supply Chains?

Answer 6

There are 4 types of supply chains:
* Manufacturer ships directly to customer (eg: Dropshipping)
* E-tailer
* Marketplaces
* Third-party logistics (3PL)

Question 7

Give examples of some generic network structures with brief explaination

Answer 7

Some generic structures are:
* Integrated fulfillment:developing e-tailer capabilities into exisiting distribution centres that deliver to conventional stores.

• Dedicated fulfillment:done via purpose filled ‘green-field’ operations
• Store fulfillment:Picking online orders from retail stores for separate, dedicated delivery.
• Dropshipping:Products are directly delivered to the customer by the manufacturer.

Question 8

How to choose between Store fullfilment v/s Dedicated fullfilment?

Answer 8

Choice would depend on the volume of orders. Therefore:
* Store pickup: Volume < 3000
* Dark store pickup: Volume < 20000
* Dedicated warehouse: Volume >20000

Question 9

What factors to consider when positioning a facility?

Answer 9

Factors to consider are:
* Routing cost
* Labour availability
* Labour cost
* Industrial relation laws

Question 10

kWhat are some factors to be considered when choosing products to stoc?

Answer 10

• Inventory service level to target for product
• Substitutes of product
• Perishability, obsolenscence
• Return flows
• Sustainable

Question 11

What is the flow of events of when a product is returned?

Answer 11

• Customer returns a product
• Authorisation
• Collection
• Screening
• Disposition
• Stock -> Redistribution, Rework -> Stock or Disposal, Disposal
• Redistribution