Best  Examples  of supply  chain management in Industry


Nabisco .Inc  delivers 500 types  of cookies  and more than 10,000 candies  to over 80,000 buyers
and spend s more than $200 million  a year in transportation  expenses .Unfortunately ,too many  
trucks arrive or depart  from their destination  half empty .That is why Nabisco is pioneering  a
collaborative  logistics effort , so that  Nabisco  can share trucks , warehouse  space with other
companies  in order to reduce  logistics  cost.


In  1979  Kmart was one  of the leading  companies  in the retail industry with 1891 stores and
avaerage revenues per store of $ 7.25 milllion .At that time  Wal -Mart was a small niche  retailer in
South with only
229 stores  and an average revenues  about half of those  of Kmart stores . In 10 years  Wal -Mart
has transformed itself  in 1992  it had the highest  sales per square foot and highest inventory
turnover  and operating  profit  of any discount  retailer .Today Wal- Mart is the largest  and highest
retailer  in the world . The starting point  was relentless  focus  on satisfying  customer needs .Wal
-Mart s goal was to simply provide  customers  with access  to goods when and where they want  them
 and to develop  cost structures  that enables  competitive  pricing .The key to achieving  this goal  
was to make  the way company replinishes  inventory  the centre piece  of  its strategy . This was
done  by using a logistics technique  known as cross - docking .In this strategy, goods are
continuously  delivered  to Wal-Marts ware houses , from where they are dispatched  to stores without
even sitting  in inventory .This strategy
reduced Wal -marts  cost of sales  significantly  and made it possible  to  offer  everyday low price s to
their customers .


The chairman  and CEO of Caterpillar Corporation credits Caterpillar dealers  with much of  his
recent success.He points out that  dealers  are much closer  to customers than to  the corporation  
and can respond  more rapidly  to customer needs .They arrange  financing  when the product  is
purchased  and carefully monitor,repair ,and service the product.He says that"the dealer creates the
image of  a company that doesn't just stand behind its product s but  with its products anywhere in the
world''.Caterpillar believes  that its dealer network  gives the  company  a tremendous  advantage over
 its competition ,especially  the big japanese construction  and mining equipment manufacturers  such
komatsu and Hitachi.


Swedish furniture retailer Ikea ,with $9.6billion sales ,is the world largest furniture retailer .Started in
Sweden by Ingvar Kampard ,Ikea currently has 143 stores world wide .It has grown  so dramatically
by "reinventing the furniture business "'. Traditionally furniture  sales were split between department
stores and small locally owned shops .Typically , customers would place an order , and delivery could
take place upto two months after orders was placed.

Ikea changed  tha formula by displaying all of its 10,000 products in large ware house like spaces in
out-of -town stores  and keeping all of these  itmes in the ware house .This was accomplished  by
designing products  so that they  can pe packed  compactly  and efficiently in kits . which customers  
take from the stores  and assemble at home . .These kits  are easy and cheap to transport , so
products  can be manufactured  efficiently  in a small number  of factories  and then shipped  
relatively cheaply to stores all over the world .Since Ikea has so many stores , each of  of  which is
very large , the company   is  able to take advantage of vast economies of scale . This has enabled  
the firm to sell good quality furniture  at price lower than  that of its competitors.

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