Logistics and Supply Chain Management: A Case Study of Johnstons of Elgin

Logistics
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Contents
Introduction......................................................................................................................................2
Overview of Johnstons of Elgin..................................................................................................2
Issues faced by Johnstons of Elgin in logistics................................................................................3
Vertical integration..........................................................................................................................3
Management strategies................................................................................................................4
Driving efficiencies.........................................................................................................................4
Management strategies................................................................................................................5
Supply chain mechanisms................................................................................................................6
Management strategies................................................................................................................7
Employing, upstream to downstream production and finishing processes......................................8
Management strategies................................................................................................................9
Agile and lean logistics strategies..................................................................................................10
Management strategies..............................................................................................................10
Recommendations..........................................................................................................................11
Conclusion.....................................................................................................................................12
References......................................................................................................................................13

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Introduction
The aim of the report is to talk about the logistics and the supply chain management of the given
case study that has been provided. The logistics and supply chain management field make sure
that the goods and services get into the hands of customers. The logistics industry is considered
an as an important driver of the development and economic (Gianpaolo, Laporte and Musmanno,
2013). The report includes the discussion related to the vertical integration, driving the supply
chain mechanism's and the efficiencies, employing, upstream to the downstream production of
the given case and the finishing process. The discussion for both agile and lean logistics
strategies has been done. This analysis will reflect the issues which might be faced by the
company and the solution related to the management strategies has been discussed. These
management strategies will help the company in bringing the effectiveness in their operations
which will ultimately lead to the success.
Overview of Johnstons of Elgin
Johnstons of Elgin history began in the year 1797 when Alexander Johnston first initiated by
taking a lease on a woollen factory in Newmill in Aberdeenshire, Scotland. The business that is
operated by the company is a woollen mill that is operating the business operations at the same
place. The workers of the mill also sometimes wear the clothes that are manufactured with the
custom design and produced tweed (Oscar Hunt, 2018). This shows that the business of the
company is in success but the company is dealing with the issues related to the supply chain and
logistics. Gradually, the company began to import the cashmere due to which they were able to
develop a range of the fine woven clothes that are made from the fibre. In the year 1931, the
company entered into the cashmere kitting industry and also opened the separate factory in
Hawock which is located in the Scottish borders.

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Issues faced by Johnstons of Elgin in logistics
In the case of the logistics of Johnstons of Elgin, there are various issues that are faced by them
while performing the activities involved in the supply chain management. One of the major
issues that are faced by the company is time management. The time is consumed by a mill in
processing not only in slow-moving processes but also in the unnecessary stock holding which
includes raw material, work-in-progress and the finished inventory. Along with this, the
company faced the issues in the fall of profit in the year 2006 due to the rise in the competition
and the shift of the focus. Though, the company can reduce the issues which are faced by them
by applying the management strategies. These management strategies are going to be
incorporated in the processes.
Vertical integration
The vertical integrations are referred to as the arrangement of the supply chain management in
which two or more stages of the production normally operated by the different firms (Harrison
and Hoek, 2011). In this integration, the company is able to control more than one stage of the
supply chain at the same place. According to the case study, this has been found that over last
two hundred years the mill of Johnstons of Elgin is still at the same location. Along with this, the
woollen mill is also considered as the UK’s last remaining vertically integrated woollen mill.
Considering the concept of the vertical integration, the woollen mill processes the operations at
the same location which include the receipt of the raw material to the finished products. This
provides the potential benefits to the company which are discussed below: -