Supply chain technology (SCT) is considered the unsung hero of the modern business world. SCT refers to the tools, systems, and solutions that are designed to streamline and optimise various processes within a supply chain. The primary goal of these technologies is to help businesses manage their supply chains more efficiently and effectively, reducing costs and improving overall performance.
But what are supply chain technologies, and how do they benefit your business? We first need to understand what a supply chain is and how important they are for the production line of steps that is your business.
What is a supply chain?
A supply chain is a network of people, organisations, resources, activities and technology involved in the creation and sale of a product or service.
Here’s an example of how your business and Delta Fulfilment’s services look within the supply chain:
The Supply Chain Process
Depending on your business, the supply chain process can be broken down into many different stages:
- Sourcing of raw materials: This involves obtaining the necessary components, ingredients or materials needed to create your products.
- Manufacturing/Production: Materials are transformed into finished products or services through various processes such as assembly, fabrication or other production methods.
- Logistics: Products are moved from the production facility to distribution centres.
- Marketing and sales: This stage involves promoting and selling your product to customers.
- Order processing: Once an order is placed, the customer’s goods are picked and packed, ready to be sent out.
- Transportation: Products are then sent, often involving multiple transportation modes and complex shipping routes.
- Customer service and support: After-sales services like technical support, warranty and returns are also key parts of the supply chain process.
Supply Chain Examples
Supply chains can be found in various types of industries and sectors. Here are a few examples:
- The fast food industry: In this sector, supply chains involve the procurement of raw ingredients such as potatoes, meat, and vegetables, which are then processed into the restaurant’s menu items. These products are then transported to individual restaurants and served to customers.
- The electronics industry: Smartphones, tablets, and other gadgets involve a supply chain where components like processors, screens, batteries and memory chips are sourced from different suppliers. These components are then assembled into the final product, which is distributed to retailers and eventually sold to consumers.
What is Supply Chain Technology?
Supply chain technology refers to the digital tools and systems used to streamline and improve the efficiency of supply chain processes, from sourcing raw materials to distributing finished products. It allows for better operations management, such as manufacturing, transportation, and inventory control. Ultimately, SCT helps businesses by reducing costs without compromising on customer retention.
The Uses of Supply Chain Technology
Supply chain technology supports businesses in managing and optimising the flow of goods, services, and information from the initial supplier to the final customer. Nowadays, it often utilises advancements like artificial intelligence (AI) to make operations more efficient.
Businesses use advanced tools and software to monitor stock levels, control costs, and prevent overstock or shortages. With SCT, you can automate these processes to maintain optimal inventory levels, minimise waste, and improve customer satisfaction.
Accurately predicting customer demand is essential for supply chain efficiency. Advanced analytics and AI-powered tools help businesses interpret historical data and external factors, like market trends and seasonal demand, to project future demands.
Transportation and logistics
SCT allows businesses and customers to track and monitor their shipments in real time. Tools like location tracking ensure timely delivery of products and minimise transport-related issues. This transparency in the supply chain allows companies to improve route planning, reduce transportation costs and increase operational efficiency.
Supplier relationship management
Maintaining strong relationships with suppliers is crucial for a well-functioning supply chain. Cloud-based supply chain technologies create a line of communication and promote collaboration between businesses and their suppliers. This allows both sides to share information in real time to avoid conflicts.
SCT helps businesses identify, analyse, and reduce potential risks, like disruptions due to natural disasters, regulatory changes, or supplier bankruptcy. By leveraging data analytics and monitoring tools, business owners can develop contingency plans and implement preventive measures to ensure supply chain resilience and maintain smooth operations.
Types of Supply Chain Technology
Warehouse Management Systems
Warehouse Management Systems (WMS) help businesses increase efficiency and accuracy within their warehouse operations. These systems integrate with businesses’ e-commerce platforms like TikTok Shop and Shopify. This allows for better inventory control and tracking, as well as improved order-picking and stock replenishment processes. WMS often integrate with other supply chain technologies like transportation management systems and supply chain planning systems to ensure smooth end-to-end execution. At Delta Fulfilment, our warehouse management system integrates with your e-commerce platform to allow us to support your inventory management, process customer orders in real time and handle returns on your behalf.
Transportation Management Systems
Transportation Management Systems (TMS) focus on optimising the movement of goods from one location to another. These systems offer features such as route planning, carrier selection, and tracking capabilities to ensure timely and cost-effective transportation. By automating many manual processes, TMS provide both cost savings and increased visibility into the transportation aspect of the supply chain.
Supply Chain Planning Systems
Supply Chain Planning Systems (SCP) assist organisations in strategically managing their end-to-end supply chain operations. These systems utilise advanced algorithms and data analysis to support various planning functions, including demand forecasting, inventory management, and production planning. SCPs promote better decision-making by providing insights into areas for improvement, with the goal of enhancing overall supply chain efficiency.
Supply Chain Visibility Software
Supply Chain Visibility Software (SCVS) provides businesses with a greater level of insight into their supply chain processes. These solutions offer real-time information on inventory levels, order statuses, and transportation updates. This allows you to address potential issues before they escalate.
What are the Benefits of Using Supply Chain Technology?
There are many benefits to using supply chain technology, from improving the efficiency of production lines to creating sustainable practices to reduce the carbon footprint of your business.
Improved production efficiency
Automating various processes and having access to real-time data allows businesses to make informed decisions that result in reduced lead times, increased output, and decreased inventory levels. These technologies simplify day-to-day operations, allowing companies to focus on their core competencies and streamline their overall performance. For example, a procurement platform can automate invoicing, payments, and vendor management to increase efficiency and accuracy and reduce human errors.
Visibility and control over supply chain operations
Digital supply chain solutions allow you to monitor the entire supply chain in real time. This heightened visibility helps to prevent risks, reduce costs, and ensure on-time fulfilment of customer demands. As an example, demand forecasting tools can leverage historical data and machine learning algorithms to predict future demand more accurately.
Supply chain collaboration
By connecting suppliers, manufacturers, distributors, and retailers through a single digital platform, businesses are better able to communicate and share important information with customers and partners. In effect, supply chain technology creates a more transparent and efficient supply chain.
Sustainability and traceability
Consumers and regulators are more interested than ever in information on the origin, production methods, and environmental impact of the products they buy. Advanced supply chain solutions (like blockchain technology) enable businesses to track the entire lifecycle of a product, from raw materials to finished goods. This visibility helps keep processes compliant with regulations and demonstrates a commitment to environmental and social responsibility.
The Future of Supply Chain Technology
Driven by the need for greater efficiency, supply chain technology is evolving rapidly. In the coming years, we expect to see several key trends shaping the future of supply chain technology.
A much-needed development in supply chain technology is the rise of customer-centric supply chains. These supply chains focus on meeting customers’ needs with an agile approach while still contributing to the business’s profitability. Future success in supply chain management will depend on being purpose-built and built to last, ensuring that supply chains can adapt to changing market conditions.
By 2025, we may also see a shift from global flows of goods and services to regional and local networks of buyers and suppliers. This change will result from the need to build more resilient and flexible supply chains amidst global challenges like geopolitical tensions, climate change, and worldwide pandemics.
What recent trends are impacting supply chain technology?
Recent technological advancements such as Artificial Intelligence (AI), Machine Learning (ML), cloud computing, big data analytics, blockchain, and automation are transforming supply chain operations. These technologies help organisations to increase efficiency, improve visibility, reduce risks, and enhance decision-making processes.
Delta Fulfilment: Your 3PL Partner
Are you ready to embrace technology for business growth? At Delta Fulfilment, we analyse each business’s unique needs and craft order fulfilment solutions that fit like a glove. Get a quote from Delta Fulfilment, your third-party logistics partner and let’s streamline fulfilment operations for your business.