Somerset’s global supply chain contains the labor costs in an entire production process hence quite significant for the firm. The supply chain enabled Somerset to lessen its key labour cost to a lower value of about 80% due to the minimum wage rates that were imposed in China as compared to other regions in Randolph County in the side of North Carolina. Also most of the equipment and machinery used within the manufacturing plants that were old within Randolph County were not required into most of the manufacturing plants in the China region. The Somerset’s Chinese’s had totally outsourced all the skilled workers from the firm who would easily copy the same design and quality from accessing the available tools and equipment. There was an ineffective order process and poor logistics and inventory management from the product inconsistency that was witnessed. The whole act hence led to poor business performance since there were negative effects which frustrated Somerset through the poor logistics management.
Somerset’s global supply chain business needs
The basic approach to meet the supply chain demands entails incorporating and executing proper management for most of the best fit suppliers section. The feature will establish a platform where the members work with the supply partners, customers, suppliers and distributors to ensure that a competitive level is fully maintained. The business should engage in a global supply chain management where it easily leverages most of its activities as a buyer. The furniture company should renegotiate certain terms and conditions which protects it from quality problems. In enhancing the efficiency during the turnaround time for Somerset, it is appropriate for the business to hire certain checkpoint liaisons and other individuals who will help monitor activities during the shipping procedures. Most of the checkpoint liaisons should be positioned in specific areas to ensure that they handle certain delays that may exist. By making legal arrangements it would promote the flow of goods within the region that are prone to delays.
Delegate your assignment to our experts and they will do the rest.
Possible remedies for its supply chain problems
The problem on humidity should be addressed adequately by adopting a technological advancement with better quality in maintaining the chemicals. It should also allow the furniture being shipped to adopt a constant quality based on its original state throughout the whole transportation process. Also most of the warranty contracts should be placed at one year to enable to repair shops and other service centers to present their basic and domestic features adequately. The available old plants for production should be used as service or repair centers and placed in the warehouse grounds to help speed up the process of movement of goods from the production grounds to the needed destinations. Lastly, the small scale production of different parts can be conducted in the repair centers to help reduce the time spent in engaging in production.
Strategic and tactical changes that might improve the company’s supply chain performance, and reduce system variability
Somerset can easily apply for a JIT delivery system that will help reduce the overall costs in holding and transporting the products to the market. The delivery system will enable the company to order through computer software system that addresses the order well enough. Also the prime evaluation of the global supply chain will enable the company to increase its emerging costs more than the profits and savings. The inclusion of a risk and problem analysis will help in the identification of problems in the company and the definition of feasible solutions. For system variability it will be essential to adopt a prevention budget which handles most delays and other issues on quality that would affect the flow of products in the market.
Improving quality and customer service
The re-evaluation of the supply chain will help increase the company costs through the available profits and savings based on the high quality services. From the aspect of a globalized industry it will enable them to compete with their competitors while adopting different operation techniques.
