Supply Chain Management (SCM) is a cross functional inter-enterprises system that uses information technology to help support and manage the links between some of a companies key business processes and those of its suppliers, customers and business partners. The goal of SCM is to create a fast, efficient and low-cost network of business relationships or supply chain to get a company‘s products from concept to market. Thus a SCM is interconnected information system of business organizations which helps in easy flow and tracking of the raw materials, intermediate products and finished goods. It minimizes the material warehousing cost and product delivery cost.
Supply chain management (SCM) is the oversight of materials, information, and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer. Supply chain management involves coordinating and integrating these flows both within and among companies. One can say that the ultimate goal of any effective supply chain management system is to reduce inventory (with the assumption that products are available when needed).
Supply chain management flows can be divided into three main flows:
• The product flow
• The information flow
• The finances flow
The product flow includes the movement of goods from a supplier to a customer, as well as any customer returns or service needs. The information flow involves transmitting orders and updating the status of delivery. The financial flow consists of credit terms, payment schedules, and consignment and title ownership arrangements