Table of Contents
Book: Guide to Supply Chain Management ............................................................................................ 3
2 Guide to Plan in Supply Chain Management .................................................................................... 3
2.1 Inventory and Supply Chains ..................................................................................................... 3
2.2 Demand and Supply Planning .................................................................................................... 4
2.3 Sales and Operations Planning .................................................................................................. 7
7 Guide to Strategy in Supply Chain Management ............................................................................. 9
7.1 Introduction to Corporate strategy ........................................................................................... 9
7.2 Achieving Strategic Alignment in Supply Chain Companies .................................................... 11
7.3 Concept to Support Supply Chain Strategy Development ...................................................... 11
9 Guide to Finance in Supply Chain Management ............................................................................ 14
9.1 Introduction to Supply Chain Finance ..................................................................................... 14
9.2 How Companies Cascade Financial Information ..................................................................... 14
9.3 How to Add Value and Improve Corporate Financial Performance ........................................ 16
9.4 Financial Benefits of Sustainable Supply Chains ..................................................................... 17
11 Guide to Outsourcing in Supply Chain Management ................................................................... 17
11.1 What is Outsourcing? ............................................................................................................ 17
11.2 The Tendering Process of Outsourcing.................................................................................. 18
11.3 Improved Service Through Better 3PL Management ............................................................ 18
Book: Export Management ................................................................................................................... 19
5 Choosing an Entry Strategy ............................................................................................................ 19
5.1 Methods of Exporting and Entry Strategies ............................................................................ 19
5.2 Indirect Export ......................................................................................................................... 20
5.3 Producing Abroad .................................................................................................................... 21
5.5 Competition in Foreign Markets ............................................................................................. 21
5.6 International Influences on the Choice of Distribution Channel ............................................. 21
5.7 Mergers and Acquisitions ........................................................................................................ 22
5.8 Strategic Alliances.................................................................................................................... 22
6 Financial Policy in Exports .............................................................................................................. 22
6.1 Organization of Financial Policy .............................................................................................. 22
6.2 Various Financial Characteristics of an Export Business ......................................................... 22
6.3 Covering Against Currency Risk ............................................................................................... 22
6.4 Policy Relating to Debtors ....................................................................................................... 23
6.5 Export Credit Insurance ........................................................................................................... 23
1
, 6.6 International Payments ........................................................................................................... 23
6.7 Financial Documents ............................................................................................................... 24
6.8 Bank Guarantees ..................................................................................................................... 24
7 Exports, Logistics and Customs Policy ............................................................................................ 25
7.1 Logistics at the Strategic Level ................................................................................................ 25
7.2 Customs Policy......................................................................................................................... 25
7.3 Logistics at the Tactical Level .................................................................................................. 25
7.4 Customs at the Tactical Level .................................................................................................. 26
7.5 Logistics at the Operational Level ........................................................................................... 26
7.6 Customs at the Operational Level ........................................................................................... 26
Book: Logistics & Supply Chain Management ....................................................................................... 27
13 Creating a Sustainable Supply Chain ............................................................................................ 27
13.1 The Triple Bottom Line .......................................................................................................... 27
13.2 Greenhouse Gases and the Supply Chain.............................................................................. 27
13.3 Reducing the Transport-Intensity of Supply Chains .............................................................. 27
13.4 Peak Oil .................................................................................................................................. 28
13.5 Beyond the Carbon Footprint ................................................................................................ 28
13.6 Reduce, Reuse, Recycle ......................................................................................................... 28
13.7 The Impact of Congestion ..................................................................................................... 29
2
, Book: Guide to Supply Chain Management
2 Guide to Plan in Supply Chain Management
2.1 Inventory and Supply Chains
Inventory: The quantity of goods that is available on hand or in stock.
Why hold inventory?:
2.1.1 Different Types of Inventory
1) Cycle/replenishment stock: Inventory necessary to meet the normal daily demand.
2) Safety stock: Buffers against forecast error and supplier’s unreliability.
3) In-transit stock: Stock in the process of being transported to a stocking or
delivering point.
4) Seasonal stock: Stock built up in advance to meet increased sales volumes
during a particular time of the year.
5) Promotional stock: Feeds into marketing campaigns and advertising.
6) Speculative stock: Stock held to protect against price increases or limited availability.
7) Dead or obsolete stock: Stock that is no longer usable or saleable in the market.
2.1.2 Cycle stock
When talking about cycle stock, it is worthwhile looking at how much stock we hold throughout the
year. The average stock holding calculation is based on the order quantity. As the level of stock varies
between the maximum at the time of receipt and the minimum just before the next delivery, we can
Q
define stockholding as: 𝐴𝑆 = 2
with AS = average stockholding, and Q = order quantity.
3
Book: Guide to Supply Chain Management ............................................................................................ 3
2 Guide to Plan in Supply Chain Management .................................................................................... 3
2.1 Inventory and Supply Chains ..................................................................................................... 3
2.2 Demand and Supply Planning .................................................................................................... 4
2.3 Sales and Operations Planning .................................................................................................. 7
7 Guide to Strategy in Supply Chain Management ............................................................................. 9
7.1 Introduction to Corporate strategy ........................................................................................... 9
7.2 Achieving Strategic Alignment in Supply Chain Companies .................................................... 11
7.3 Concept to Support Supply Chain Strategy Development ...................................................... 11
9 Guide to Finance in Supply Chain Management ............................................................................ 14
9.1 Introduction to Supply Chain Finance ..................................................................................... 14
9.2 How Companies Cascade Financial Information ..................................................................... 14
9.3 How to Add Value and Improve Corporate Financial Performance ........................................ 16
9.4 Financial Benefits of Sustainable Supply Chains ..................................................................... 17
11 Guide to Outsourcing in Supply Chain Management ................................................................... 17
11.1 What is Outsourcing? ............................................................................................................ 17
11.2 The Tendering Process of Outsourcing.................................................................................. 18
11.3 Improved Service Through Better 3PL Management ............................................................ 18
Book: Export Management ................................................................................................................... 19
5 Choosing an Entry Strategy ............................................................................................................ 19
5.1 Methods of Exporting and Entry Strategies ............................................................................ 19
5.2 Indirect Export ......................................................................................................................... 20
5.3 Producing Abroad .................................................................................................................... 21
5.5 Competition in Foreign Markets ............................................................................................. 21
5.6 International Influences on the Choice of Distribution Channel ............................................. 21
5.7 Mergers and Acquisitions ........................................................................................................ 22
5.8 Strategic Alliances.................................................................................................................... 22
6 Financial Policy in Exports .............................................................................................................. 22
6.1 Organization of Financial Policy .............................................................................................. 22
6.2 Various Financial Characteristics of an Export Business ......................................................... 22
6.3 Covering Against Currency Risk ............................................................................................... 22
6.4 Policy Relating to Debtors ....................................................................................................... 23
6.5 Export Credit Insurance ........................................................................................................... 23
1
, 6.6 International Payments ........................................................................................................... 23
6.7 Financial Documents ............................................................................................................... 24
6.8 Bank Guarantees ..................................................................................................................... 24
7 Exports, Logistics and Customs Policy ............................................................................................ 25
7.1 Logistics at the Strategic Level ................................................................................................ 25
7.2 Customs Policy......................................................................................................................... 25
7.3 Logistics at the Tactical Level .................................................................................................. 25
7.4 Customs at the Tactical Level .................................................................................................. 26
7.5 Logistics at the Operational Level ........................................................................................... 26
7.6 Customs at the Operational Level ........................................................................................... 26
Book: Logistics & Supply Chain Management ....................................................................................... 27
13 Creating a Sustainable Supply Chain ............................................................................................ 27
13.1 The Triple Bottom Line .......................................................................................................... 27
13.2 Greenhouse Gases and the Supply Chain.............................................................................. 27
13.3 Reducing the Transport-Intensity of Supply Chains .............................................................. 27
13.4 Peak Oil .................................................................................................................................. 28
13.5 Beyond the Carbon Footprint ................................................................................................ 28
13.6 Reduce, Reuse, Recycle ......................................................................................................... 28
13.7 The Impact of Congestion ..................................................................................................... 29
2
, Book: Guide to Supply Chain Management
2 Guide to Plan in Supply Chain Management
2.1 Inventory and Supply Chains
Inventory: The quantity of goods that is available on hand or in stock.
Why hold inventory?:
2.1.1 Different Types of Inventory
1) Cycle/replenishment stock: Inventory necessary to meet the normal daily demand.
2) Safety stock: Buffers against forecast error and supplier’s unreliability.
3) In-transit stock: Stock in the process of being transported to a stocking or
delivering point.
4) Seasonal stock: Stock built up in advance to meet increased sales volumes
during a particular time of the year.
5) Promotional stock: Feeds into marketing campaigns and advertising.
6) Speculative stock: Stock held to protect against price increases or limited availability.
7) Dead or obsolete stock: Stock that is no longer usable or saleable in the market.
2.1.2 Cycle stock
When talking about cycle stock, it is worthwhile looking at how much stock we hold throughout the
year. The average stock holding calculation is based on the order quantity. As the level of stock varies
between the maximum at the time of receipt and the minimum just before the next delivery, we can
Q
define stockholding as: 𝐴𝑆 = 2
with AS = average stockholding, and Q = order quantity.
3
