An Understanding Of Supply Chain Management Essay

931 WordsSep 22, 20164 Pages
Beginning with an understanding of supply chain management, Hill et al. (2015) defines the task as managing the components from suppliers and the flow of inputs used in production to maximize inventory turnover, while minimizing inventory holding. Competing in the smart phone market requires Samsung to use innovation, a source of competitive advantage, possibly leading to high profit gains if production costs can be reduced and quality can be improved (Hill et al., 2015). Should Samsung succeed in producing high quality at a low fabrication cost, they could compete with Apple, for example, and possibly earn higher profits to match their large market share, which currently does not match their profits. Many components are required and involved in the assembly or in the making of a smartphone. Looking at Samsung competitor, Apple, in an effort to determine the high end of how much it costs to produce a product, renowned for its quality, the Apple 7, for example, costs $224.80 in bill of material costs to manufacture (Buetow, 2016). Presumably, each new product release and launch, including the new and higher price, would be based on the consumer anticipation of higher quality functions and inputs or capabilities. For example, the Apple 7 offers increased storage density, larger battery, waterproof microphone, water resistance, all with a new look (Buetow, 2016). Interestingly, according to Buetow (2016) Samsung makes a lower margin from hardware than Apple,

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