supply cbain boi

Inventory

Products the company holds that is in stock or in transit

raw materials

purchased items which are manufactured into components and products

work in process (WIP)

Goods that is in the process of being made. Raw materials to final inspection.

Black Hole

Stuff that gets lost in WIP. U think u have extra material, but its lost in the making process

Maintenance, Repair, and Operating (MRO) Supplies

Shi that help make the product but dont go into the product. Could be consumed in creation process

Finished Goods

Shi that is actually sold to the customer.

Facilitating Goods

Items that help service industries do the service

Cycle Stock

Stock u use to meet immediate customer demand. Decreases and increases along with customer demand

Safety Stock

Extra stock buffer to help against uncertainty in demand.

Strategic Stock

Stock u buy outside of customer demand. Buying stuff at certain times or amounts to get a better price.

Pipeline Inventory

Inventory in transit, held by suppliers/other people

Obsolete Inventory

Inventory that has gone bad. Expired, damaged, etc. Usually u can donate it or destroy it

direct cost

costs in product

indirect cost

costs outside of product

variable cost

cost dependent on the amount of product u make

fixed cost

cost is always the same.

Order Cost

Labor costs associated with getting orders ready to the customer

Too much inventory

resources in inventory, underlying probs in product can mess up ur plan, no way to know how to improve process.

Too little inventory

Production disruptions create need for additional costs. Longer delivery lead times. Less responsiveness, losing money

Abs Inventory Value

Value of inventory at cost or market value

Inventory Turnover

How much inventory turns during year. COGS/Avg Inventory cost

Continues Model

Inventory levels are continuously reviewed. Real time updates, dynamically add new inv based on needs

Reorder Point

Lowest inventory level where a new order must be placed or else youll run out of items.

fixed time period system

if inventory is less than target, it is brought back up

fixed order quantity system

Whenever inv drops below a certain point, order the same amount of inventory. Continuous checking

EOQ Economic Order Quantity

Tradeoff of order costs and carrying costs.

Order Costs

preperation, transportation receipt processing, material handling

Carrying Cost

Cost of capital, taxes, insurance, obsolescenece, storage.

indiv item purchase price discount

discount for ordering larger quantities.

multiple item purchase price discount

Buying a combo of items can give u a discount from one vender

transportation freight rate discount

Trying to fit more shi on ur freight transports

ABC System

Splitting items at A or B and C. A is the most important. B is kinda middle, C is least important

Bin System

Physical bins where u put stuff. Usually labelled for what is in it

Single Period Model

Inventory is only ordered for one time stocking

Linear/2d Barcodes

Codes that u can scan with a scanner. Gives u info about the product. 2D barcodes hold more info

RFID

No line of sight needed, tracks shi through radio towers

Procurement

Selecting partners/others to buy goods and services. Lets u lock in costs

Purchasing

Buying shi to support ur operations in supply chain

Supply Management

Encompasses all activities within sourcing, buying, etc

Purchase Requisition

Internal doc that tells u what goods and shi u need. Is not a contractual relationship with external party. Requires authorization, systematic or otherwise

Purchase Order

A binding order by a buyer to get goods from the seller. What u need, how much u want, etc.

e-procurement

B2B purchase and sales of supplies over net. Automates RFI, RFP, RFQ.

Merchants

Wholesalers who purchase for resale

Industrial Buyers

Buys large raw materials to convert into other type of goods

Contracting

Acquisition of Services

RFI Request for Info

Asking for info on the capabilities of suppliers. If they can actually do what u wanna do

RFP Request for Proposal

Suppliers actual ability to make things and if they wanna make thing

RFQ Request for Quote

How much the shi actually costs you

Profit Leverage Effect

Decrease in expenses results in an increase in profit

Return on Asset (ROA)

Being able to get ur money back from buying assetts

Inventory Turnover Effect

Optimal usage of space and inventory amount.

Total Cost of Ownership

Sum of all costs associated with all activity in production of product

QSDP

Quality service delivery and price. Four big parts of TCO that u have to check out for

Value Added Services

Special delivery, special packaging, prep of promotional displays, subassembpleys in plant

Pre Transactional Cost

Costs before actual transaction. Choosing sources, updating database, training supplier

Transaction Costs

Part of transaction. Price negotiation, delivery conformation, po admin, transport, etc

Post transactional Cost

Costs after transaction. Returns

Make vs Buy Decision

Do u make shi at home or do u buy it?

Business Strategy

Pillar of Make v Buy Strategy. Strategic importance of porduct to company. Resources cshould be there to make product or deliver

Risks

Pillar of supply chain. Trying to maximize lower quality, reliability, and predictability of products recieved on suppliers.

Economic Factors

Pillar of supply chain. How much it’ll cost u to make a thng in house vs buying it outside. QUality vs cost trade off

Qualitative Reasons To Make

Less lead time, u hold complete owenrship of items, better quality conrol

Quantitative Reasons to Making

Lower cost to make it in house. Also no moeny on transport costs

Cosourcing

Sharing process or function between staff and provider. U use the same quality tester

Backward Vertical Integration

Buying supplier’s network. Adding them to ur supply chain

Forward Vertical Integration

Buying ur customer. IE: Medicine company buying a CVS or a pharmacy or some shi

Centralized Purchasing

One central department making purchasing decisions around the company

Decentralized Purchasing

Individual departments making their own purchasing decisions.

Centralized/Decentralized Purchasing

LIttle bit of centralized little bit of decentralized

Import Brokers

Agents by the government that construct servide for a fee. Buys shi for u

Trade Companoes

Buys shi from other countries. Has their own distribution network

Import Merchants

Dude who buys shi from other countries and resells

Bid Process

A bid or process in response to something from another org

Sealed Bid

Like normal bids but on gov level. More secretive, sent in response to invitations to bid

Competitive Bidding

Suppliers bidding for right to supply. Lowest cost wins bid usually. Competition reallll good

open competetive bidding

Bids are open for all to see

closed competetive bidding

Bidding open for relevant parties

Bid Bond

Debt by bidder for providing guarantee that supplier will fulfill the contract

Preformance Bond

Guarantee that the work will be done on time as needed

Payment Bond

Providing protection between any 3rd parties

Benchmarking

Seeing how ur company is doing and how u can improve

Sourcing

Identifying partners that will get u shi

Strategic Sourcing

Finding out ways to reduce costs, improve quality of product, and getting prods faster to market. Categorize suppliers and build relationships.

Single SOurce

Multiple potential uppliers, only choosing to work with one

Multi Source

BUying a good from multiple sources. Good for backups, creates competition

Non critical

low percentage of firms spend and little risk

bottleneck

higher risk and availability is low. Small alternatives

Leverage

High alternatives, risk is low. Spend is high

Strategic

High spend high risk.

Supply Base

Group of suppliers where a company gets shi

Supply Base Rationalization

Reducing supply base to lowest amount without impacts to quality

Strategic Alliance

Meeting between buyer and supplier to pursue agreed upon objectives while still being independent