Supply Chain Management: A Case Study Of Perky Pies

EXECUTIVE SUMMARY Perky Pies is a franchise that has few branches in different locations. Rapid business expansion caused Perky Pies to develop more stores where one of the stores that located in Footscray is the place where the pies are produced from. However, few complaints about pies delivery from branches were filed to the central office due to error in amounts, postpones of orders, out-of-date pies and expired pies. Supply Chain Management is a process that handle problems in the aspects of suppliers, manufacturers, distributors and retailers. It is a process that helps to increase the profit. The benefits that can get from SCM are improves in communication, reduce errors and improves the production operation.

The organizations who involved in the supply chain are suppliers, manufacturers, distributors, retailers. Besides, transporters, warehouses, and more also contributes to the network. These organizations carry out functions such as new product development, marketing, operations, distribution, finance, and customer service. (Chopra, Sunil & Peter Meindl 2004). The network is connected when customers order a product from retailers, the retailers then order from distributors, and distributors order from manufacturers, and manufacturers get raw materials from suppliers. In addition, a supply chain involves the constant flow of information, products, and funds between various stages (Chopra, Sunil & Peter Meindl 2004). SCM is about fulfilling a customer’s request of a product by sending it to the correct location, at the correct time, at a best price, as well as in the best condition. Overall, the supply chain starts when a customer place an order and ends when the customer has made his or her

One of the issues is that changing from one supplier to another will cause changing costs. When the cost of changing is expensive, the supplier will have full authority. For example, Microsoft products had been used by most of us. To change it to another software or hardware, there will be high cost in repurchasing the new software or hardware. The other issue is supply chain management is concentrated. Suppliers will have greater capability to command terms to their clients when there is only few suppliers conquering the industry. For example, DeBeers which is a mining company takes control over more than fifty percent of the global diamond production and this will eventually makes them the main price maker as they set the selling price of the diamonds for most of the world’s jewelers. Moreover, the greater size of suppliers compared to buyers has becomes the issue for this management. This will eventually give power to the suppliers and sell to a group of disintegrated buyers. Saudi Aramco, the world’s leader in oil production has subsidiaries in North America, Europe and Asia. In 6th of January 2015, Saudi Aramco raises their prices for all the crudes in Asia and decrease their prices in Europe and most in United