What is a Supply Chain?

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What is a Supply Chain?
A supply chain is a coordinated network of people, organizations, resources, activities, and information with the goal of product delivery to customers from suppliers. It involves the various activities that happen before a particular product reaches the end-user or customer, from the production of goods down to their distribution and sale.

The first part of typical supply chains involves the actual source of the product or supply. This part involves the raw materials for a particular product. For big companies and businesses, it is typical that products are sourced from more than one supplier. Others also choose to have one supplier only to maintain high quality of products. These supplies or raw materials will then be moved to the manufacturing or production part of the supply chain. In this stage, the raw materials will be converted to the actual product for distribution and sale. Once the product is produced, this will then go through distribution. Some will go through warehousing and inventory, while other products go straight up to the retail stores.

During the entire cycle of supplies moving from one stage to another, various organizations and people may be involved and so it may require some form of management. Since each part of the cycle is required to coordinate with the other parts, it is important that the supply activity flow is smooth and efficient. It is common for various suppliers to make adjustments in the middle part of the supply chain in order to achieve their goal of product delivery to customers. After all, though there may be several organizations involved in the supply, manufacture, and distribution of goods, each of them should coordinate with each other to promote more efficiency in terms of resource usage, inventory management and/or labor force handling, to reach goals and meet the ever-changing customer needs.

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