bus 101 Essay

2884 Words Oct 9th, 2013 12 Pages
SM C101 Chapter 1 Page 29 Internet Questions
1. Visit the websites of companies like Wal-Mart, Dell and Home Depot, and see if you can find discussions of their supply chain management activities. List information you can find on purchasing/supplier issues, logistics, information systems, quality and customer service.
Purchasing/supplier issues: Wal-Mart always emphasized the need to reduce its purchasing costs and offer the best price to its customers. The company procured goods directly from manufacturers, bypassing all intermediaries. Wal-Mart was a tough negotiator on prices and finalized a purchase deal only when it was fully confident that the products being bought were not available elsewhere at a lower price. Wal-Mart spent a
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Although the purchase rate somehow remain steady at the customer end, it has been found that the variation of order rates amplify up the supply chain, from the retailer level to the distributor level. This phenomenon is called bullwhip effect, and the distorted information from one end of a supply chain to the other can lead to tremendous inefficiencies, such as excessive inventory investment, poor customer service, lost revenues, misguided capacity plans, inactive transportation, and missed production schedules.
What happens when a supply chain is plagued with a bullwhip effect that distorts its demand information as it is transmitted up the chain? In the past, without being able to see the sales of its products at the distribution channel stage, HP had to rely on the sales orders from the resellers to make product forecasts, plan capacity, control inventory, and schedule production. Big variations in demand were a major problem for HP’s management. The common symptoms of such variations could be excessive inventory, poor product forecasts, insufficient or excessive capacities, poor customer service due to unavailable products or long backlogs, uncertain production planning (i.e., excessive revisions), and high costs for corrections, such as for expedited shipments and overtime. HP’s product division was a victim of order swings that were exaggerated by

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