This paper will discuss the importance of sales, operations, and resource planning for the supply chain

Supply Chain

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Abstract

This paper will discuss the importance of sales, operations, and resource planning for the supply chain. In most organizations, supply chain planning (the administration of supply-facing and demand-facing activities to minimize mismatches and in the process creates and capture value) is a cross-functional effort. These function area tend to specialize each in its portion. This paper will therefore discuss on the importance of integrating these functions to work together. The functions to be discussed are sales, operations, and resource planning for the supply chain.

Introduction

Sales, operations, and resource planning for the supply chain are fundamental aspects of coordination for achievement of success. Some of the success factors for sales, operations, and resource planning for the supply chain are Ongoing, routine Supply and operation meetings, having a well structured meeting agendas, having pre-work support meeting inputs, and cross functional participation. In addition, empowering participants to make decisions, running the organization’s process in a fair way, and having internal collaborative process that leads to consensus and accountability, it also contributes to the success of the sales, operations, and resource planning for the supply chain. Additionally, doing a joint supply and demand planning to ensure balance, measuring the process, supporting the process by an integrated demand –supply planning technology and having external inputs to the process would help in making the process successful (Hugos, 2011).

Importance of sales, operations, and resource planning for the supply chain

Management

Importance of sales, operation and resource planning for the supply chain include management. The importance here is that organizing the suppliers and their raw material sources to give you the right products at precisely the best time of year. This also comes at a good price that enables profit maximization. As balancing of all the deliveries and costs of your merchandise is carried out, you then have the other side of sales that rely on a whole other set of variables. Through proper management, other factors like prevailing economic situation, company customer preferences, and dynamism and employee skill are taken into consideration to complete the supply chain.

Vendors

Another merit is the function of vendors in the supply chain. Sales, operations, and resource planning for the supply chain makes operations of vendors much simplified. Each has a different set of logistics that affect turn-around delivery times, ordering specifications and payment plans. This takes into account and tries to correct the nuances of each vendor when devising a plan for future deliveries. In many cases, an electronic database or matrix with staggered delivery times may be of help in keeping cash flowing so you don’t have it all placed in inventory at one time.

Inventory.

Management practices have demonstrated that out that Inventory is one of a company’s primary assets. While its value is inherent in the goods, it does not earn a company profits unless it is moving. According to management study guides, the success of any business has been found to rely on how often the business can turn inventory over in a financial year. Sales, operations, and resource planning for the supply chain take into account the products out on shelves while conducting an inventory. It also takes into account those held in backrooms, inventory housed at a third party site and goods that are in transit. It makes sure that there is no interruption of any of the supply lines to avoid any effects on sales.

Projections.

Another importance of sales, operations, and resource planning for the supply chain is that it is easier to plan for future deliveries. Moreover, it is also easier to manage supply chain when one has years of experience with the same vendors, same products and similar customer trends. Sales, operations, and resource planning for the supply chain is also helps in predetermining cost and leaving room for any eventuality depending on previous trends. It enables relying on past sales and inventory flow as an ideal way to plan for future orders and sales events. Likewise, it also enables any successful business to create a reliable master plan, which can be used for recurring operations. It is advisable for the master plan to include records of previous figures of sales, inventory cost and regulations pertaining to deliveries. Most importantly, it creates options on which you can rely when any one of the pieces in the chain is disrupted.

Importance of Sales Forecasting

Sales forecasting can be described as a self-assessment tool that companies use in to conduct internal analysis of the company. It is a time-to-time analysis of the company to establish how well the company operates towards achievement of goals, mission and vision of the company. In many circumstances, it is used to predict the future position of a company. Some of the benefits of sales forecasting include knowing when to do purchases and what quantity to buy, having a deep knowledge of the customers and their buying behaviors, and having an improved cash flow. It is also beneficial in the sense that it allows a business to plan for its production capacity, establish the pattern of its sales, establish the net value of the business and calculate the expected returns on the overall investments made. Nevertheless, it is advisable that a business integrates sales forecast as into all aspects of the business (Mentzer and Moon, 2004).

Reference

Mentzer, J. and Moon, M. (2004). Sales Forecasting Management: A Demand Management Approach. California: Sage Publications.

Hugos, M. (2011). Essentials of Supply Chain Management. New Jersey: Wiley