SKU
Stock Keeping Unit: A unique unit (form, function) of inventory held in stock.
Channel
A method whereby a business sells its product, e.g. mass retail, catalog call
center or web-based electronic storefront.
POS
Point-of-Sale: The time and place at which a sale occurs, e.g. cash register, or
order confirmation screen on-line.
Stockout
A situation where no stock is available to fill a customer order.
ASN
Advanced Shipping Notice: Electronic notification sent by a supplier to a buyer
Bullwhip effect
Orders and Inventory flatten out as it goes through: Supplier – Manufacturer – Distributor – Retailer
Disruptors in the supply chain
Geopolitical events, cyberattacks, health crises, natural disasters
What forces are the driving the rate of change
Globalization, Technology, Consolidation, Empowered consumers, and government policy and regulation.
Globalization
Compression of time and distance affects:
What we source, where we manufacture, where we market and sell, where we distribute, and what transport we use
Technology
Facilitator of change
Consolidation
Since 2000, consumers have held power, mainly due to the internet
Empowered Consumers
More enlightened and educated consumers
With demand variety and customized products, it requires greater supply chain agility and flexibility.
Competitive prices – require greater efficiency.
Government Policy and Regulation
Deregulation occurred in several sectors back in the 1990s such as transportation, communications, and financial institutions.
SCM
SCM is the art and science of integrating the flows of products, information, and financials through the entire supply chain from the supplier’s suppliers to the
customer’s customers.
Supply Volatility
Dynamic receiving schedules, cross-docking for erratic supply, safety stock positioning, supplier – warehouse synchronization, and flexible physical layout.
Demand Volatility
Slotting optimization and zoned picking, flexible labor models, demand sensing and dynamic reorder points, postponement and light manufacturing.
Product, Information, Cash, and Demand flow
Product flow – Physical movement of goods and materials
Information flow – Enabling physical flow of products, decision making, and supply chain collaborations.
Cash flow – management of working capital
Demand flow – Detect and understand demand signals, and synchronize demand vs supply
Distinctives
High risk, low value
Engineered Items
Generics
Low risk, low value
Office Supplies
MRO items
Criticals
High risk, high value
Unique items
Items critical to the final product
Commodities
Low risk high value
Basic production items
Basic packaging
Logistics services
MRO
Maintenance, Repair and operating supplies – intended to retain or restore a functional unit to its operational state.
J-I-T
coordinating arrival of purchased production materials to arrive just-in-time to
be used in manufacture and assembly to reduce cost of holding inventory.
Lead time
The elapsed time from when an order was placed until the goods are received.
