SOUTHEAST UNIVERSITU

Mid Term Examination

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Submitted To:

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rs e Farzana Akter
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Course Lecturer
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Department of Bachelor of Business Administration School of Business Studies

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Southeast University
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Course Title: Supply Chain Management

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Course Code: SCM3111

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Section: 1

Submitted By:
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Name: MD. Rayhan Kabir

ID: 2016010000207
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Date: 14 Dec 2020

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 1. How supply chain decisions playing an important role for
making business sustainable? Briefly explain with
appropriate examples.

Ans:
The importance of supply chains for the sustainable business. Global giants Google and WWF
turned heads this June after announcing the details of their environmental data platform, a joint
initiative which aims to tackle harmful emissions and waste across fashion industry supply
chains. This will allow fashion brands to source raw materials and track their sustainability,
providing them with greater transparency over the environment.

The news comes as the fashion industry continues to grapple with a giant sustainability problem.
Today, the industry accounts for about 2-8% of global greenhouse gas emissions, much of which

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originates from the raw material stage. entail impact of their supply chains. Supply chain

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emissions are up to 5.5 times greater than a company’s direct operations – but until recently, a

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lack of transparency and accurate data prevented us from seeing the full picture.

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The five drivers provide a useful framework for thinking about supply chain capabilities.
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Decisions made about how each driver operates will determine the blend of responsiveness and
efficiency a supply chain is capable of achieving.
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1. PRODUCTION:
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This driver can be made very responsive by building factories that have a lot of excess capacity and use
flexible manufacturing techniques to produce a wide range of items. To be even more responsive, a
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company could do their production in many smaller plants that are close to major groups of customers so
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delivery times would be shorter. If efficiency is desirable, then a company can build factories with very
little excess capacity and have those factories optimized for producing a limited range of items. Further
efficiency can also be gained by centralizing production in large central plants to get better economies of
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scale, even though delivery times might be longer.

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2. INVENTORY:
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Responsiveness can be had by stocking high levels of inventory for a wide range of products. Additional
responsiveness can be gained by stocking products at many locations so as to have the inventory close to
customers and available to them immediately. Efficiency in inventory management would call for
reducing inventory levels of all items and especially of items that do not sell as frequently. Also,
economies of scale and cost savings can be gotten by stocking inventory in only a few central locations
such as regional distribution centers (DCs).

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 3. LOCATION:
A location decision that emphasizes responsiveness would be one where a company establishes many
locations that are close to its customer base. For example, fast-food chains use location to be very
responsive to their customers by opening up lots of stores in high volume markets. Efficiency can be
achieved by operating from only a few locations and centralizing activities in common locations. An
example of this is the way e-commerce retailers serve large geographical markets from only a few central
locations that perform a wide range of activities.

4. TRANSPORTATION:
Responsiveness can be achieved by a transportation mode that is fast and flexible such as trucks

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and airplanes. Many companies that sell products through catalogs or on the Internet are able to

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provide high levels of responsiveness by using transportation to deliver their products often

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within 48 hours or less. FedEx and UPS are two companies that can provide very responsive
transportation services. And now Amazon is expanding and operating its own transportation

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services in high volume markets to be more responsive to customer desires. Efficiency can be
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emphasized by transporting products in larger batches and doing it less often. The use of
transportation modes such as ship, railroad, and pipelines can be very efficient. Transportation
can also be made more efficient if it is originated out of a central hub facility or distribution
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center (DC) instead of from many separate branch locations.

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5. INFORMATION :
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The power of this driver grows stronger every year as the technology for collecting and sharing
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information becomes more wide spread, easier to use, and less expensive. Information, much
like money, is a very useful commodity because it can be applied directly to enhance the
performance of the other four supply chain drivers. High levels of responsiveness can be
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achieved when companies collect and share accurate and timely data generated by the operations
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of the other four drivers. An example of this is the supply chains that serve the electronics
market; they are some of the most responsive in the world. Companies in these supply chains,
the manufacturers, distributors, and the big retailers all collect and share data about customer
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demand, production schedules, and inventory levels. This enables companies in these supply
chains to respond quickly to situations and new market demands in the high-change and
unpredictable world of electronic devices (smartphones, sensors, home entertainment and video
game equipment, etc.).

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 2. Inventory is an asset for any business. But it also costs a lot.
Now, from your perspective, discuss how it is playing a role in
developing competitive strategy of any business?

Ans:

Inventory:
Inventory is one of the primary sources of business revenue, especially for retail or wholesale
businesses and is therefore listed as an asset. All raw materials, work in process, and finished
goods within a supply chain.

Now I discuss about my perspective how it is playing a role in developing competitive strategy
of any business:

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Role in the competitive strategy:

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Facilities:

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o Economies of scale (efficiency priority)
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o Larger number of smaller facilities (responsiveness priority)

Inventory:
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o Form, location, and quantity of inventory allow a supply chain to

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range from being very low cost to very responsive.

o Objective is to have right form, location, and quantity of
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inventory that provides the right level of responsiveness at the

lowest possible cost.
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Transportation:
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o Allows a firm to adjust the location of its facilities and inventory

o to find the right balance between responsiveness and efficiency.
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 3(A). How your business can maximize the value of supply chain
surplus? Explain Briefly?

Supply chain is a process of sharing product, fund and information among the parties of supply
chain, includes-supplier manufacturers, whole seller, retailer and customer in an effective and it
efficient way.

-Customer is the only source of revenue.

-Sources of cost includes flows of information, products, or funds between stages of the supply
chain.

-There are mainly two objectives of Supply Chain.

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Maximize the value of supply chain surplus:

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Supply chain surplus = Customer value – Supply chain cost

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-Example: A customer purchases a wireless router from Best Buy
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for 60 tk (revenue).
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-Supply chain incurs costs 20 tk

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(information, storage, transportation, components, assembly, etc.).

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-Difference between 60 tk and the sum of all of these costs is the

supply chain profit.

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Effective supply chain management is the management of

flows between and among supply chain stages to maximize total

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supply chain surplus.

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-Effective Fund Management that means effective money Management.

-Effective Information Management I have to use a perfect use of Information . True and on time
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information.

-Effective Product/service Management.

-Effective HR Management.

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 Suppose you are going to start a hotel/resort business, what will
be your business’ pricing technique and why?

If I going to start a new hotel or resort business that’s time my business pricing technique is
given bellow:

My pricing strategy takes into account segments, ability to pay, market conditions, competitor
actions, trade margins and input costs, amongst others. It is targeted at the defined customers and
against competitors.

Pricing techniques:
-Pricing determines the amount to charge customers for goods and services

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-Affects the supply chain level of responsiveness required and the demand profile the supply

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chain attempts to service.

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-Pricing strategies can be used to match demand and supply.
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-Firms can utilize optimal pricing strategies to improve efficiency and responsiveness.

-Pricing strategies vary to meet different customer responsiveness requirements.

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Components of Pricing Decisions:

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Pricing and economies of scale:

The provider of the activity must decide how to price it appropriately to reflect these economies
of scale.
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Everyday low pricing versus high-low pricing:

-Different pricing strategies lead to different demand profiles that the supply chain must serve.
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-Fixed price (this price never changed) versus menu (different

price for different segment product) pricing.

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 4. In this pandemic situation online businesses are flourishing.
Suppose you have also decided to open an online business. Now,
from the perspective of supply chain, what costs you have to face
while conducting online business? And what sorts of benefits you
would get to do online business than opening retail shop? Discuss.

In this pandemic situation I have also decided to open an online business Now, from the
perspective of supply chain, what costs I have to face while conducting online business is given
bellow:

Response time to customers:.

-Physical products take longer to fulfill than retail store no delay for information goods

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Product variety:

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-Easier to offer larger selection

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Product availability:
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-Aggregating inventory and better information on customer preferences improves product
availability.
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Customer experience:
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-Improved access, customization, and convenience

-Faster time to market

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Order visibility:
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Returnability:
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-Harder with online orders

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-Proportion of returns likely to be much higher

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Direct sales to customers:

-Social networking channels allow firms to directly pitch products and promotion.

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 Flexible pricing, product portfolio, and promotions:
-Manage revenues from product portfolio more effectively than traditional channels.

-Promotion information can be conveyed to customers quickly and inexpensively.

Efficient funds transfer:

For benefits I would get to do online business than opening retail shop .

Benefits of retail shop:

 seem more secure than shopping online.

 Offer Convenience.
Customers Test the Merchandise.

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 help customers make a decision.

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provide inspiration.

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
 give customers emotional gratification

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 make it easy to pay.rs e
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 have the personal touch.
 encourage impulse purchases.
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 build relationships.
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