What is a Supply Chain?

If you’re new to the world of logistics, one word that is tossed around quite a bit is ‘supply chain’. But what is it exactly? 

In this post, we explain what happens on the supply chain, the different roles involved, and why it’s such an integral part of the transportation industry as a whole.

What is a Supply Chain?

The supply chain is a complex system of processes for making and selling commercial goods. It starts with the supply of materials for manufacturing, then getting the finished products from the point of origin to the point of consumption.

The global supply chain ensures that goods from all over the world can be shipped to other countries, ultimately ending up on the store shelves in your neighborhood or delivered right to your doorstep.

With the demand for faster shipping practices increasing due to online shopping, efficient supply chain management is pertinent for success.

Why is Supply Chain Management Important?

From streamlining customer service to reducing operating costs, the efficiency of supply chain management is the foundation for operating a successful business.

Customers expect deliveries to be made on time, without damages. This doesn’t only apply to delivering the products, but also returns and warranty servicing. 

Warehouses need to be stocked, as customers expect products to be on-hand when an order is placed. 

There are numerous levels to manage, risks to mitigate, and costs to take into account. Otherwise, one mistake or delay can derail the order and potentially erode the customer’s trust.

Different Supply Chain Roles

The team that manages a supply chain is comprised of a few different roles. This includes a Chief Procurement Officer (CPO), Chief Logistics Officer (CLO), and a Supply Chain Manager. Let’s go over the responsibilities of each role.

CPO: This is an executive position that focuses primarily on sourcing, procurement, and management for business. They monitor the costs to ensure every value is accounted for while looking at different ways to reduce costs. The CPO also oversees procurement procedures and compliance guidelines.

CLO: A CLO provides logistical support by managing the transfer of goods or services on the supply chain. This includes confirming the right items are shipped in the correct quantities in a timely manner.

Supply Chain Manager: When it comes to overseeing general processes of the workers, product manufacturing, inventory, and negotiating contracts with suppliers/vendors, the supply chain manager takes an internal approach to supply chain operations.