Supply Chain Management - SCM

Loading the player...

What is 'Supply Chain Management - SCM'

Supply chain management (SCM) is the streamlining of a business' supply-side activities to maximize customer value and to gain a competitive advantage in the marketplace. Supply chain management (SCM) represents an effort by suppliers to develop and implement supply chains that are as efficient and economical as possible. Supply chains cover everything from production, to product development, to the information systems needed to direct these undertakings.

BREAKING DOWN 'Supply Chain Management - SCM'

Typically, SCM will attempt to centrally control or link the production, shipment and distribution of a product. By managing the supply chain, companies are able to cut excess fat and provide products faster. This is done by keeping tighter control of internal inventories, internal production, distribution, sales and the inventories of the company's product purchasers.
SCM is based on the idea that nearly every product that comes to market results from the efforts of various organizations called the supply chain. Although these supply chains have existed for ages, until recently most companies have paid only scant attention to them.

RELATED TERMS
  1. Supply Chain

    The network created amongst different companies producing, handling ...
  2. Supply

    A fundamental economic concept that describes the total amount ...
  3. Value Chain

    A high-level model of how businesses receive raw materials as ...
  4. Chain Store Sales

    An indicator that provides information on the monthly sales volumes ...
  5. Supply Shock

    An unexpected event that changes the supply of a product or commodity, ...
  6. Change In Supply

    A term used in economics to describe when the suppliers of a ...
Related Articles
  1. Markets

    How Supply Chain Management Works

    Supply chain management seeks to streamline the tasks that comprise the supply chain process.
  2. Professionals

    Why You Should Consider A Career In Supply Chain Management

    Supply chain managers ensure that increasingly global companies can coordinate distant sources of materials, labor, and manufacturing to successfully bring products to market.
  3. Markets

    Explaining the Supply Chain

    A supply chain is the cumulative network involved in moving raw materials, components and finished products from original suppliers to end users.
  4. Insights

    Target Tells Suppliers To Move Faster Or Pay-Up (TGT)

    Target has begun cracking down on its vendors in an attempt to increase its supply chain efficiency, says a report.
  5. Investing

    The Basics Of Value Chain Analysis

    Value chain analysis establishes an action plan to understand and implement actvities that create values to a firm's clients, resulting in firm profits.
  6. Trading

    Open Interest

    Learn more about this commonly used term found in a stock's option chain.
  7. Investing

    What's a Distribution Channel?

    A distribution channel is a chain of businesses through which a manufacturer sends his products to get them to a final buyer. It may involve wholesalers, distributors, agents and retailers. Companies ...
  8. Markets

    Explaining the Value Chain

    A model of how businesses receive raw materials as input, add value to the raw materials, and sell finished products to customers.
  9. Entrepreneurship & Small Business

    How To Expand Your Business Internationally

    A guide to the risks and rewards of expanding a business abroad.
  10. Insights

    Warren Buffett's Moat: How Sustainable Is Trader Joe's Competitive Advantage?

    Understand the factors that have led to retail grocer Trader Joe's competitive advantage over some of its notable competitors, including Whole Foods.
RELATED FAQS
  1. What is the difference between supply chain management and value chain management ...

    Discover what the principal differences are between utilizing a supply chain management system and a value chain management ... Read Answer >>
  2. What is the difference between a value chain and a supply chain?

    Understand the difference between a value chain and a supply chain. Learn why a company would want to maximize the value ... Read Answer >>
  3. What are some advantages and disadvantages of value chain analysis?

    Learn about the five activities that make up a generic value chain. Understand the advantages and disadvantages of value ... Read Answer >>
  4. How does a strong value chain management team help a company?

    Understand what makes up a company's value chain and the point of a value chain. Learn how a strong value chain management ... Read Answer >>
  5. How can I use value chain analysis to evaluate investment decisions?

    Understand how an investor can use value chain analysis to evaluate an investment decision. Learn what activities add value ... Read Answer >>
  6. Is demand or supply more important to the economy?

    Learn more about the impact of supply and demand in an economy. Find out why companies study supply and demand as part of ... Read Answer >>
Hot Definitions
  1. Duration

    A measure of the sensitivity of the price (the value of principal) of a fixed-income investment to a change in interest rates. ...
  2. Dove

    An economic policy advisor who promotes monetary policies that involve the maintenance of low interest rates, believing that ...
  3. Cyclical Stock

    An equity security whose price is affected by ups and downs in the overall economy. Cyclical stocks typically relate to companies ...
  4. Front Running

    The unethical practice of a broker trading an equity based on information from the analyst department before his or her clients ...
  5. After-Hours Trading - AHT

    Trading after regular trading hours on the major exchanges. The increasing popularity of electronic communication networks ...
  6. Omnibus Account

    An account between two futures merchants (brokers). It involves the transaction of individual accounts which are combined ...
Trading Center