Logistics and Supply Chain Management Principles : Hangzhou Yongde Electric Appliances Limited

Running head: LOGISTICS AND SUPPLY CHAIN MANAGEMENT PRINCIPLES 1
Logistics and Supply Chain Management Principles
(A Case-Study of Manufacturing Company in China)
Student’s Name
Institutional Affiliation

LOGISTICS AND SUPPLY CHAIN MANAGEMENT PRINCIPLES 2
Logistics and Supply Chain Management Principles
The approaches used to manage inventory has become increasingly important for most
manufacturing companies. Hangzhou Yongde Electric Appliances Limited Company is a foreign
direct investment company that is engaged in manufacturing electronic devices and components.
Therefore, as the price of raw materials as well as the operation costs increases, the company has
been experiencing a challenge in maintaining a smooth relationship among its level of inventory,
promote customer satisfaction, and increase production efficiency. Traditionally, organizations
operating in the supply chain network pay led attention to their suppliers and customers.
However, due to the nature of globalization coupled with the development of intensive
relationship among firms, have resulted into a transition in the modern business management, as
well as in the management of the supply chain networks. Therefore, since holding inventory is
very costly, it is important to put in place effective inventory management practices which is
very important for supply chain operations.
Different company’s functions may not align with the inventory level. For example,
marketing operations may need to ensure that the inventory is kept at high levels as possible to
ensure that customers’ needs are satisfied (Ravindran Warsing Jr, 2016). On the other hand,
production may also need to maintain a high inventory to provide support to high production
levels and minimize the current asset levels. Such issues may result into conflicts which may
generate a question on the level of inventory that should be maintained to reduce operation cost
and satisfy customer demands. Most manufacturing companies in China are currently
experiencing the same issue, which has greatly undermined their efficiency. The paper seeks to
explore operations management issues at the selected Chinese manufacturing company to
suggest possible ways to tackle the issue.

LOGISTICS AND SUPPLY CHAIN MANAGEMENT PRINCIPLES 3
Over the past decade, the organization has heavily invested in information technology
and has become a pioneer in this aspect. As a result, the company has grown to become a
significant source manufacturing electronic components (Coyle, Langley, Novack, & Gibson,
2016). The company’s core competencies are mainly mirrored in its proficiency in bar-code
technology, managing networks, and wireless communication. The essay explores the core
functions of logistics provided by the selected company and how they interface with each other.
Further, it will explore the effectiveness, well as efficiency of the current order cycle and
inventory management system used by the organization (Coyle, Langley, Novack, & Gibson,
2016). Further, the study will examine the theories, as well as the associated concepts of logistics
and SCM, and further propose the necessary improvements.
Company Background
Being one of the top manufacturers of passive electronic components in China, Hangzhou
Yongde Electric Appliances Limited Company provides a wide range of portfolio, which
comprise of multilayer varistors, disk varistors, as well as thermistors. These electronic devices
are mainly used in consumer electronic appliances, automotive, and industrial appliances. These
devices are mainly used for the heating functions and for protection. The company has over 40
subsidiaries globally. Therefore, to store finished products and raw materials, the organization
has a single warehouse.
Logistics and Core Functions of R&D Company
The company is among the best players in manufacture of electronic components (Coyle,
Langley, Novack, & Gibson, 2016). The company is characterized with very strong
competencies that allow it to competing effectively in the sector. These comprise of appropriate
customer response time and the adoption of cutting-edge technology coupled with innovative