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    How Supply Chain Management Helps in Cost Reduction ?

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    Dhananjay Gaur Jaipuria Jaipur
    Supply chain management (SCM) refers to the management of the flow of goods and services from raw materials to the final consumer. SCM helps reduce costs in several ways, including (1) planning to reduce waste and unnecessary expenses, (2) using multiple suppliers to avoid delays and expenses from a single supplier, and (3) optimizing asset utilization, storage space, packaging and other processes to lower operational costs. By efficiently managing the supply chain from procurement to distribution, SCM eliminates redundant activities and costs at various stages.

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    How Supply Chain Management Helps in Cost Reduction ?

    Uploaded by

    Dhananjay Gaur Jaipuria Jaipur
    23 views4 pages
    Supply chain management (SCM) refers to the management of the flow of goods and services from raw materials to the final consumer. SCM helps reduce costs in several ways, including (1) planning to reduce waste and unnecessary expenses, (2) using multiple suppliers to avoid delays and expenses from a single supplier, and (3) optimizing asset utilization, storage space, packaging and other processes to lower operational costs. By efficiently managing the supply chain from procurement to distribution, SCM eliminates redundant activities and costs at various stages.

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    Supply chain management (SCM) refers to the management of the flow of goods and services from raw materials to the final consumer. SCM helps reduce costs in several ways, including (1) planning to reduce waste and unnecessary expenses, (2) using multiple suppliers to avoid delays and expenses from a single supplier, and (3) optimizing asset utilization, storage space, packaging and other processes to lower operational costs. By efficiently managing the supply chain from procurement to distribution, SCM eliminates redundant activities and costs at various stages.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    23 views4 pages

    How Supply Chain Management Helps in Cost Reduction ?

    Uploaded by

    Dhananjay Gaur Jaipuria Jaipur
    Supply chain management (SCM) refers to the management of the flow of goods and services from raw materials to the final consumer. SCM helps reduce costs in several ways, including (1) planning to reduce waste and unnecessary expenses, (2) using multiple suppliers to avoid delays and expenses from a single supplier, and (3) optimizing asset utilization, storage space, packaging and other processes to lower operational costs. By efficiently managing the supply chain from procurement to distribution, SCM eliminates redundant activities and costs at various stages.

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    How supply chain management helps in

    cost reduction ?

    Supply Chain Management (SCM) refers to the


    management of the flow of goods and services which
    involves the movement and storage of raw materials, of
    work-in-process inventory, and of finished goods from the
    point of origin to the point of consumption. It helps in
    reducing the cost in various ways. Some are-
    1. Planning-SCM includes arranging which brings about
    diminishing disarray with respect to putting in a request,
    work to perform which decreases odds of wasteful
    administration and spending of additional cost because of
    it. This aide in lowering of cost.

    2. Using of Multiple Suppliers-If we just utilize one


    provider we dispose of rivalry for our requests. To
    discover a few providers who can contend with cost, and
    utilize a few of them constantly so we can evade expensive
    deferrals in getting items. In the event that one provider is
    out, another may have the things. Utilizing numerous
    providers shields us from burning through cash for not as
    much as attractive administration.

    3. Asset Utilization-Get greater profitability out of less


    cost.

    4. Supply chain organizes configuration Keep costs


    down and unwavering quality up by outlining your system
    to limit item taking care of.

    5. Proper Utilization of Space-Efficient capacity


    technique decreases the measure of room we utilize and
    the measure of the time it takes to discover and pull things
    in the distribution centre. This outcome in lessened lease
    and finance costs.
    6. Customer Demand Pattern-Evaluate and break down
    client request example and request in like manner as
    client's prerequisites shape our production network
    methodology and structure.

    7. Outsourcing-SCM may include outsourcing which


    brings about the advantage of both the gatherings and
    makes a sound and proactive organization.

    8. Elimination of Redundant Activities-SCM diminishes


    excess which in a roundabout way decreases cost.

    9. Packaging-SCM includes better bundling. The better


    you bundle your items, the more outlandish your items
    will be harmed when dispatched which brings about
    minimization of odds of harm and the cost identified with
    it.

    10. Efficient Management-SCM additionally includes in-


    house activities which incorporates legitimate working in
    an association, understanding and decreasing debate
    inside that could unfavourably affect an association. So
    cautious appraisal of inner tasks advances the execution
    and productivity of inventory network and administration
    which brings about decreasing expense.
    CONCLUSION-Thus by above focuses specified, we can
    state that store network administration lessens cost from
    numerous points of view.

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