Does the Using of Supply Hub Can Improve the Efficiency of the Supply Chain?

Essay by slothdickUniversity, Bachelor'sA-, March 2005

download word file, 8 pages 3.5

1. Introduction

Does the using of supply hub can improve the efficiency of the supply chain? That is vital question should be solved how is improving the efficiency of supply chain among the supply chain partners. With the rapid development of the world economic and the progress of the science and technology, the modern logistics is developing swiftly in the global.

How to plan and optimal the logistical and supply chain management become more important for promoting the development of modern logistics. Erenguc et al. point out that through a dominant firm in a supply chain usually tends to optimize locally with no regard for its impact on the other members of the chain, there are cases of such firms capable of fostering more cooperative agreements in the chain. Wal-Mart and the Vendor Managed Inventory (VMI) program is a case in point. Under Wal-Mart's retail link program, suppliers like Johnson and Johnson, and Levers Brothers get the online summary of point-of sales data .

Erenguc et al. still further highlight that firms in a supply chain with no clear competitive advantages may still form alliances in order to compete in the global market place.

For instance, to support Just-In-Time (JIT) production, the goal of JIT is to time-phase activities in order to purchased materials and components arrive at the manufacturing. Obviously, JIT generally requires more frequently deliveries of smaller quantities of purchased inputs, which may require modification of inbound transportation. Unfortunately, suppliers for companies are mostly located far from points to delivery. The long haul, with problems involved multiple supplies that would make logistics management a serials complex problems for the suppliers. But when company willing through the agreement on industry practices in relationships among the supply chain partners especially in the area of inbound logistics, who will find a...