Supply Chain

AAA

DEFINITION of 'Supply Chain'

The network created amongst different companies producing, handling and/or distributing a specific product. Specifically, the supply chain encompasses the steps it takes to get a good or service from the supplier to the customer. Supply chain management is a crucial process for many companies, and many companies strive to have the most optimized supply chain because it usually translates to lower costs for the company. Quite often, many people confuse the term logistics with supply chain. In general, logisitics refers to the distribution process within the company whereas the supply chain includes multiple companies such as suppliers, manufacturers, and the retailers.

INVESTOPEDIA EXPLAINS 'Supply Chain'

Supply chains include every company that comes into contact with a particular product. For example, the supply chain for most products will encompass all the companies manufacturing parts for the product, assembling it, delivering it and selling it.

RELATED TERMS
  1. Commercialization

    The process by which a new product or service is introduced into ...
  2. Reverse Fulfillment

    The portion of the supply chain that moves returned products ...
  3. End To End

    A term used in many business arenas referring to the beginning ...
  4. Just In Time - JIT

    An inventory strategy companies employ to increase efficiency ...
  5. Gross Processing Margin - GPM

    The difference between the cost of a raw commodity and the income ...
  6. Option Chain

    A form of quoting options prices through a list of all of the ...
Related Articles
  1. Investing

    Zooming In On Net Operating Income

    NOI is a long-run profitability measure that smart investors can count on.
  2. Insurance

    Working Capital Works

    A company's efficiency, financial strength and cash-flow health show in its management of working capital.
  3. Fundamental Analysis

    Measuring Company Efficiency

    Three useful indicators for measuring a retail company's efficiency are its inventory turnaround times, its receivables and its collection period.
  4. Personal Finance

    Five Companies Leading The Green Charge

    Corporations that reduce their environmental footprint anticipate large long-term gains.
  5. Personal Finance

    Smart Resumes For The Fashion Industry

    Here's what your need to know to tailor your resume to the fashion job you want.
  6. Economics

    What's Demand Elasticity?

    Demand elasticity is the measure of how demand changes as other factors change. Demand elasticity is often referred to as price elasticity of demand because price is most often the factor used ...
  7. Personal Finance

    What Drives Consumer Demand for Tesla?

    Tesla did not invent the electric vehicle market, but it has brought to it elements of luxury and elite status. But what really drives demand for Teslas?
  8. Savings

    Visa vs. MasterCard: Is There a Difference?

    Visa and MasterCard are two of the most widely used credit card brands. But are the differences between the two significant enough to influence consumers?
  9. Budgeting

    The Momentum, And Methods, Behind Walmart's Model

    Walmart's success stems from low costs, which are possible through specific supply and distribution strategies, and are passed to consumers as low prices.
  10. Economics

    ShopRite: Supermarket Model for Modern Shoppers?

    ShopRite is a supermarket model that stands out amid the everyday, widespread, corporate-controlled supermarket chains. But does it meet customers' needs?

You May Also Like

Hot Definitions
  1. Fixed Cost

    A cost that does not change with an increase or decrease in the amount of goods or services produced. Fixed costs are expenses ...
  2. Subsidy

    A benefit given by the government to groups or individuals usually in the form of a cash payment or tax reduction. The subsidy ...
  3. Sunk Cost

    A cost that has already been incurred and thus cannot be recovered. A sunk cost differs from other, future costs that a business ...
  4. Technical Skills

    1. The knowledge and abilities needed to accomplish mathematical, engineering, scientific or computer-related duties, as ...
  5. Prepaid Expense

    A type of asset that arises on a balance sheet as a result of business making payments for goods and services to be received ...
  6. Gordon Growth Model

    A model for determining the intrinsic value of a stock, based on a future series of dividends that grow at a constant rate. ...
Trading Center