Supply Chain Management Case Studies

The supply chain management is considered as a management concept from past two decades as the customers are concerned about timely and safe delivery. The competitiveness has been increasing among the companies to deliver the products as quickly as possible to the customers all around the world. This has made the supply chain management as a vital tool for the management. This is also measured as a competitive parameter for the companies.

Vertical integration – when you choose to produce raw materials and/or distribute finished goods themselves rather than rely on independent suppliers, factors and agents for these tasks

Vertical integration is a business growth strategy for economics of scale. It is typified by one firm engaged in different parts of production example; growing raw materials, manufacturing, transporting, marketing, and/or retailing to expand business in existing market for the firm. It can function in two directions both forward integration and backward integration.

To make a part of a larger unit Vertical and horizontal integration help to expand a company line up or down the product line and across the service producers both relate to strategies that are made to grow your business but they differ in approach. Vertical and horizontal integration is mostly done by recognized businesses because they are financially stable to take risks. Expanding horizontally is much simpler than vertically. Horizontally integrating simply to increase your market share by including a similar company. Vertical integration use forward integration and backward integration. Forward integration is a strategy where a firm gains ownership or increased control over its previous customers. Backward integration is a strategy where a firm gains ownership or increased control over its previous suppliers. Vertical integration is different from horizontal integration where a

* Vertical integration: the corporation’s decision to distribute product without outsourcing or purchasing the outsourced company to manage supply chain; nearly unanimous corporate investment expected.

integration strategy is where the organization owns all or some of its supply chain (Lawless,

Seeing all the negative and positive aspects, vertical integration is much better and useful than horizontal integration. Vertical integration is more controllable as the expansion is within the firm only. Thus it is less rigorous. The collaboration or merging act can be less controllable as the previous firm is now dependent upon the new merged firm. Trust is the main key in horizontal integration as it can be a loss in case the other merged firm can be fraudulent.

Vertical integration is when two businesses or organizations at different levels of production merge. The principal goal is to increase the overall efficiency and to cut down costs throughout the supply chain. In return, it will improve profitability and competitiveness. It allows companies to obtain matchless amount of influence over them, and if you have a company and are thinking about using it in your organization as a business strategy, it is important to know its Pros and Cons beforehand.

The vertical integration is arrangement that tends to keep the supply chain of a company owned by the same company

Several companies are using vertical integration as a way of reducing costs and increase efficiency, which leading to increased competitiveness. Companies engaged in two kinds of vertical integration: Forward integration and Backward integration. Forward integration is a theory to achieve vertical integration in the company will gain ownership of the distributors. Backward integration is a theory to achieve vertical integration in the company will gain ownership of their suppliers. Companies may use integration strategy forward or backward, or it may use a mix of both, known as a balanced integration strategy.

There are two types of vertical integration which are forward integration and backward integration. Forward integration is when “a company at the beginning of the supply chain controls changes farther along” and backward integration is when “a business at the end

such as when the company owns its distributer or its supplier . Vertical integration helps to increase the efficiency and reduce Cost by reducing turnaround time and decrease the transportation expenses . there's two types also of integration Vertical integration and horizontal and it will be shown in this essay.

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.

Supply Chain Management System; the term “supply Chain” refers to the sequence of activities involved in producing and selling a product or service.

According to our class text Supply Chain Management’s goal is to create fast, efficient, and low-cost network of business relationships to get a company’s product from concept to market. In order to understand the goal we must know that the supply chain is the process the raw materials of a product go through in order to be available to the consumer. The relationships that the business creates are needed in order to create the product, each process the product goes through creates value, the supply chain is often called the value chain. Internet technologies are increasingly making the supply chain management process much more efficient and worth the initial investment. The supply chain management life