Supply Chain Assignment -3

What is the right SC for your

Product?

Submitted by:
Suyash Tulasyan
09-56
 Task 1
1. What in your opinion is the most imp. for a successful SC and
why?
In my opinion “Maximum performance and minimum cost” is the most important factor for
successful supply chain because if performance of supply chain is good than product can
reached to the ultimate customer on time and in right manner.

2. Can functional and innovative products be combined? Give

example?
Yes, functional and innovative products can be combined Example-Starbucks Coffee.

3. Why innovative products have short lifecycles?

Innovative product has short lifecycles because company enjoy a competitive advantages and
also consumers changes some aspect of their values or lifestyle

4.Why market mediation costs should be primary focus for

managers dealing with innovative products ?
Market mediation costs should be primary focus for managers dealing with innovative
products because if Market mediation costs arise than supply exceeds demand and a
Product has to be marked down and sold at a loss or when supply falls short of demand,
resulting in lost sales opportunities and dissatisfied customers.

5. When should a company transform an innovative product to

functional?
When innovative product demand is matured and it is no more innovative than company
should transform them into a functional product.

6. How can a price promotion of a functional product incur

more costs to the selling company?
This can be explain by taking example of Campbell Soup, there was a big spike in shipments of
Chicken Noodle Soup because of deep discounts that Campbell was offering. Retailers
responded to the price cut by stocking up, in some cases buying a year's supply — a practice the
industry calls forward buying. Nobody won on the deal. Retailers had to pay to carry the year's
supply, and the shipment bulge added cost throughout the Campbell system.

7. What is continuous replenishment?

Continuous replenishment means filling the inventory shortage in retail outlet .

8. A set of tools is required to cope with uncertainty in

demand . Describe how these tools work.
Finding sources of new data that can serve as leading indicators or by having different products
share common components as much as possible so that the demand for components becomes
more predictable.
It can avoid uncertainty by cutting lead times and increasing the supply chain's flexibility so that
it can produce to order or at least manufacture the product at a time closer to when demand
materializes and can be accurately forecast. Finally, once uncertainty has been reduced or
avoided as much as possible, it can hedge against the remaining residual uncertainty with.
buffers of inventory or excess capacity.
 Task2
Right Supply Chain for Functional Product- Toothpaste
Toothpaste is one of a functional product which is used to satisfy our basic need.

Demand of Toothpaste is almost stable and do not change much over a period of
time.

This product has a long life cycle and higher consumption and margin per unit is
small but if volume is more than profit can be maximize and cost can be minimize.

Since Toothpaste is a FMCG product which has a higher utilization rate and long life cycle its
supply chain objective should be maximize profit and minimize cost.

So, Efficient supply chain is the right supply chain for Toothpaste which has following
Advantages:-

– Lowest possible costs

– High utilization rate

– High turns

– Min. inventory

– Cost over lead time

 – Suppliers according to cost and quality

– Maximize performance and minimize cost

Right Supply Chain for Innovative Product- Apple Ipod

Innovative product always have a short life cycle because these are unique product and
demand is not predictable same in case of Apple IPod also .

So for Apple Ipod Responsive supply chain is the right supply chain which has following
advantages

– Respond quickly

– Deploy buffer capacity

– Invest in lead-time reduction

– Suppliers acc. to speed, flexibility and quality

– Postponement