I have prepared a part of assignement in Supply Chain Management- Need help to m
ID: 369807 • Letter: I
Question
I have prepared a part of assignement in Supply Chain Management- Need help to make it more maningful.
We have picked fashion industry. The industry of Embroidery and example company is “Ambco embroideries” situated in Gurugram.
We have done Operations assignment on this company. We understand this supply chain - how goods and services are managed in this company.
A complete process and divisions below that explain the full supply chain at “Ambco embroideries”.
First start with divisions that help to understand the supply chain – Company has 5-8 different divisions inside and 3-4 outside that manage the goods and services. Few main are mentioned below that define supply chain one by one.
Company that provides thread – Thread is basic element of embroidery industry. “Ambco embroideries” has 2-3 partners who provide almost every variety of threads that is used in different tasks.
Maintenance and new technology in machinery – A separate division in-house and also expert from outside hired to maintain the machine and install new software.
Labor Unit – Company has a unit of labor allotted to each unit and 25% resources as backup in every division as inventory.
In-house inventory – This is most important part of this supply chain. This indicates demand and handles the supply between company and raw material providers.
Dispatch unit – This unit dispatched the final product to client.
If I take example of below picture for embroidery industry, planning and manufacturing is in-house. Transportation and delivery is taken care from in-house inventory team. Retail is client.
Supply chain process – Here is the process explained like L. L. Bean
Labor unit asked for raw material for tasks. Raw material is cloth on which design needs to do and different threads differentiated by color and quality.
In-house inventory manage this from external vendors those supply raw material.
Once labor unit has all inputs – raw materials and ready machines. They complete the task.
Audit – Before going to dispatch inventory, it will be audited randomly.
After audit, it’s made of packages and sent to dispatch house again an inventory.
It will wait for delivery date and then dispatched to particular client.
Challenges – All the inventory division faces the challenges in this supply chain.
Final product is ready but it can’t be delivered before fixed date. Company has to pay the cost for this.
Keeping extra inventory – Company keep 25% extra inventory in term of raw material to maintain the sudden arrived work or any big mistake happen in production.
Labor shortage – It requires low class labor i.e. very tough to get and fulfill the demand. Company suffers heavily at the time of festivals. So to minimize the effect, Company always keeps 25%-30% extra labor as inventory in production unit to achieve and maintain the required demand.
Explanation / Answer
Supply chain for a fashion industry should be very dynamic.Demand and supply match based on market require is very difficult to co-ordinate. For an effective supply chain there should be co ordination between various team which comprises of stakeholders. Instead of keeping more stock in-house which actually increase their inventory carrying cost, the company should adopt lean technologies like Just in Time ( JIT) which can drastically reduce the dependency of single supplier and will create more colloborative efforts to reduce the inventory cost. Many services can be outsource from the company which helps Company to focus more on their core competencies. Transportation and distribution can be outsourced to 3PL players based on their capability and cost . Proepr network design for supply chain based on the customer demnd enable Company to set their distribution centred or cross docks properly for promising the distribution cost ( mode shift opportunity, consolidation of shipment opportunity to be leverage properly). Human resource is another area Company can focus through partial putsourong where agencies will take care of there requirement of resource based on budget and skill set.