Chapter 1: Giant’s background
The Giant store brand hypermarket founded by the family factory as a simple grocery store in one of the suburbs of Kuala Lumpur in 1944. Its mission was to offer a wide variety of food productions at the fewest possible prices. As its reputation growth, so they did business like hypermarket.
Which acquired Giant in 1999, recognizationed that the Giant 's key to success had been them can be ability to continuously offer value for business money products. It retained their core principle even as it began transformed Giant hypermarket into a national and international brand for hypermarket.
1.1 Operating Environment in Giant hypermarket
Giant 's comes from the pricing strategy - all items sold below to
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A supply chain, the entity enterprise logistics business, supply chain planning, operation procedure and supply chain information structure and the distribution of assets, which may be concentrated to upstream to downstream, also may be scattered, chain or supply chain. Manual-intensive nightmares
Decentralized procurement says upstream diffuse supply chain. In order to cope with personalized needs, on the basis of the region, or to the consumer preference quick response to market demands, differentiation establish branch target market or to establish production area. Each region of the group enterprise production department can purchase, use the nearest market competition mechanism, cost greatly reduced purchasing and supply chain upstream distributed enterprise.
For the market characteristics of buyer 's market, the market price for the stable exchange for purchasing pattern available raw materials.
The advantages are purchasing pattern available to meet as soon as possible, especially the manufacturing enterprise with customer needs some special needs and order type production, decentralized procurement procedure is simple, easy to operate, purchase cycle is short, to meet the urgent needs of material of enterprise. But due to the relatively small number of decentralized procurement, procurement costs will be high, to form scale economic benefit.
Centralized purchasing chain upstream says manual-intensive nightmares. The
Logistics: that part of the supply chain process that plans, implements, and controls the efficient, effective flow and storage of goods, services, and related information from the point-of-origin to the point-of-consumption in order to meet customers’ requirements (CLM, 1999).
{Build the Supply Base: supplier selection1. supplier evaluation- find potential suppliers, supplier certification (qualification, education, certificationISO 9000,14000). 2. Supplier development- integrate supplier in system, quality require, product specs, schedule/delivery, procurement polices, training, engineer/production help, information transfer procedures. 3. Negotiation- significant element, strategies: Cost based price model (open books to supplier, based on time and materials) Market based price model (based on published, auction, index prices: commodities) Competitive bidding (most common, no longterm relationship, request for rfq). 4. Contracting- share risks, benefits, incentives. Centralized purchasing, E procurement (online catalogs/exchanges, online auctions).} Logistics MGT- obtain efficient operations through integration of all material acquisition, movement, and storage activities. Frequent for outsourcing, allow competitive advantage from reduce costs and improve customer service. 1.Shipping systems: truck(flexible, moves majority manufactured goods) rail( large loads, containers) Airfreight( fast/flexible light loads, expensive) water( used for bulky low value cargo, oldest way of transportation) Pipelines( transport oil, gas,
4. Logistics is a critical part of a supply chain that is an integration of the logistics systems in all the organizations
The lean supply chain helps to imrprove efforts focusing waste, improve manufacturing schedule and economically produce small quantities. It is also flexible to react to changes in the market. Hence, BMW has this facility of allowing a customer to change its order within a week of placing and still maintain the original delivery time and high quality. Similarly, agile supply chain helps in carrying a generic inventory. The best part is that it helps in reducing risk of keeping too much stock as well as being out of stock. Mass-customization can be easily pursued through an agile supply chain which offers variety at a lower total
Logistics and supply chain management is an important aspect of a firm’s strategy for the business to achieve success by creating value throughout the logistics and supply chain. The research paper will outline the concepts that are involved in creating the logistics and supply management framework. The logistics and supply chain management strategies will drive success for the company towards fulfilling and supporting customer needs, procurement and manufacturing operations of the firm.
It is quite challenging to discuss about procurement management without stating the importance of its strategies. There are four main basic procurement strategies that serve different functions within a procurement management. To begin with, a “Partnership” strategy focuses mainly on constructing mutual commitment in long term relationship with suppliers. While a “Secure Supply” strategy aims to secure short and long term supply while reducing risk from suppliers. In addition, a “Category Management and E-Procurement solutions” serves as a tool to reduce logistic complexity, improve operational efficiency, and attempts to reduce the number of suppliers. Lastly, a “Competive Bidding” strategy emphasizes on obtaining the “Best Deal” for short term transactions with suppliers.(van weele) Each of these four strategies involves a unique purchasing methodology, which implies that the complexity is embedded in an individual strategic implication. Therefore, it requires different tools to accomplish the specific strategical characteristics. A business entity may need to support and execute procurement decisions with other strategic apparatus with analytical methods, including market analysis, uncertainty analysis, price forecasting, supplier relationship and along with others.(Harvard)
Our Supply Chain Consultant will work with client organizations to improve their supply chain and logistics performance, reducing their cost structure and\or improving their capabilities. These improvements are realized through initiatives involving strategic planning, process re-engineering, and/or information technology implementation. Our Consultant will execute a wide range of projects which include: logistics network design, facility (plant or warehouse) rationalization, plant and warehouse design, operational assessment, technology/software selection and solution implementation. Typical project tasks will include data gathering, data analysis, process mapping, defining requirements, current situation or baseline establishment, alternative scenario creation and analysis.
The Giant store brand was founded by the Teng family as a simple grocery store in one of the suburbs of Kuala Lumpur in 1944. Its mission was to offer a wide variety of products at the lowest possible prices. As its reputation grew, so did its business.
Supply chains represent the procurement, production and distribution activities of an organisation. Within a supply chain, these activities are viewed as linked and reliant on one another to produce the final outcome. It is believed that if one component of the chain fails, the whole chain is broken and product/service delivery goals will not be achieved.
(Bowersox, D.J., Closs, D.J., and Cooper, M.B. (2010). Supply Chain Logistics Management. (3rd Edition) New York, NY: McGraw-Hill/Irwin.
food giant was based on the perfection of its operations - the recipe for its success and growth. Its
The class text states that Supply chain management is frequently divided into supply chain planning applications, supply chain execution applications, logistics management, and warehouse management. Often when companies fail at implementing an efficient supply chain because of the planning section, or inaccurate demand forecasts. The text states electronic data interchange is one of the earliest uses of information technology for supply chain management, Electronic data interchange is the use of the Internet for everyday business transactions. “In this era of information a firm’s supply chain should operate at speed of thought and this is possible only by enhanced e-speed communications and information sharing with their critical partners.” (4)
Other strength of Giant includes being owned by cash rich Dairy Farm an international firm based in Hong Kong with potential for good investment and expansion. Giant operates in locations on a rented premises with spaces rented out to other tenants reducing the cost of maintaining the operations. Giant has established supply chain process in place with good relationship with suppliers in Malaysia. Giant has a strong brand name in Malaysia achieved via numerous marketing and promotional
Procurement also is the selecting from a range of options for acquisitions, and in analyzing and identifying the requirements for the purchasing, negotiating contracts, picking the suppliers, the creating of strategic alliances with suppliers, or the acting as a liaison between the user and suppliers. The current state of procurement practice reflects the dynamic interaction between the opposing forces, leaving the remaining in limbo. The two complementary process is involved in the procurement is vendor selling and customer buying. The best practice in the procurement process is the Exchange-Point Analysis. The exchange points highlight the opportunities for the process integration, which are noted for performance improvement opportunities. The process integration is to convert critical aspects for the supply chain process and procurement from one based on commercial norms about markets and current laws to the one that relies upon goal alignment and trust through the chain of command. The current best practices in industry or government project management include the belief based operations between vendors and customers (Morris & Pinto,
It has been two decades since the internal operations are consistently streamlined, manufacturing support up, quality of the products are generally enhanced, the expenses of assembling are consistently decreased yet now the organizations are presently concentrating on the reducing of logistics by mean of putting right supply chain methodologies for the excellence of organizations (Mangaladurai & Nemati, 2013). According Mangaladurai and Nemati European companies are spending between 5% to the highest ratio of 15% of the total budget of the company. In the United States, companies have used more than $ 670 billion on the supply chain related activities during the year 1993 which was the 10.5% of the aggregate GDP.