Why is transportation important to supply chain management H

Solution

The purpose of Supply Chain Management is to enable a linkage of the flow of goods from the raw materials to its end-users thereby including a broad network of Company’s various parties such as the suppliers, the intermediaries and finally the customers. The management of this network is possible with the establishment of the transportation as its prime medium. With the activity of designing the Transportation as its medium of supply, there is higher efficiency established in the system of the Supply chain network that gives rise to the income generation power of the firm and adds value to the end product that reaches to the customer.

The firm’s Supply Chain Management would therefore include effective marketing channels in its network designing part that could be typical to countries or regions in terms of the Market segmentation and based on such a segmentation, designing the most suitable transportation channel that could help cater the same more efficiently. It is to be also noted that a Company’s supply chain network can never be static and evolves in response to various scope available in a specified regions and the conducive conditions associated with it and hence does the mode of transportation.

In terms of how does forecasting help in a successful supply chain program:

Based upon the Forecasting, various crucial decisions could be undertaken such as the distribution of supply chain could be intensive or selective or exclusive, depending upon the Market segmentation. Intensive distribution is aimed at maximum market coverage; selective distribution is aimed at making the product available to selected dealers or retailers only in a given territory while an exclusive distribution is most restrictive form of market coverage. Based upon the category of classifications, forecasting would further help in tapping the future audiences as its target market. Forecasting is also required to help the Production and Sales team meet the anticipated demand in more efficient way. In addition, forecasting also aids in Logistics network. If certain exigencies, whether manmade or natural is forecasted, then accordingly, logistics and distribution could be altered such that it helps ensuring uninterrupted supply of the products to its customers.