- Supply chain management (SCM) is the management of the flow of goods. It includes the movement and storage of raw materials, inventory and finished goods from point of origin to point of consumption.
- In the food industry, the efficiency of the supply chain is vital to profitability and safety.
- When one link in the food supply chain, such as a farmer or packaging plant, isn’t operating at peak performance, every other link in the chain is negatively affected
- An estimate of how Supply Chain Management works, in food processing Industry could be as follows:
- Raw materials like grains, raw meat, fish etc. are collected at different locations by different sources.
- These sources may do preliminary processing of these to make components of a food product, before passing over them to the main manufacturer through many middlemen
- The manufacturer does the final processing of these components to make the food product
- Now the finished product has to be delivered to the consumer. Here also there will be a number of middlemen and stages
- Further, the manufacturer normally hands over the food product to a wholesale dealer
- The wholesaler passes the product to a retailer from where the consumer buys the processed food item for his personal use
- Thus, Supply Chain Management is the management of the upstream and downstream, with value-addition at each stage:
Suppliers→ company→ retailer→ final consumers
Suppliers→ company→ retailer→ final consumers
