Logistics and Supply Chain Management

This report analyzes the supply chain management and driving efficiencies of Johnston of Elgin, a luxury clothing company. It covers vertical integration, upstream to downstream production, agile and lean logistic strategies, and recommendations for improvement.

Running head: LOGISTICS AND SUPPLY CHAIN MANAGEMENT
Logistics and supply chain management
Name of the Student
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Author Note

LOGISTICS AND SUPPLY CHAIN MANAGEMENT
Table of Contents
Introduction:...............................................................................................................................2
Vertical integration:...................................................................................................................2
Supply chain mechanisms and driving efficiencies:..................................................................3
Employing, upstream to downstream production and finishing process:..................................5
Agile and lean logistic strategies:..............................................................................................6
Recommendation:......................................................................................................................7
Conclusion:................................................................................................................................8
References list:...........................................................................................................................9

LOGISTICS AND SUPPLY CHAIN MANAGEMENT
Introduction:
The report is prepared for analyzing the product development process of Johnston of
Elgin which is the luxury clothing company established in year 1797 as the oldest family
business of Scotland (johnstonsofelgin.com, 2018). The company has successfully competed
in the global market because of modern approach that it has adopted to working life. Report
demonstrates the vertical integration adopted by company in its manufacturing process.
Supply chain mechanisms and driving efficiencies of company have also been analyzed. In
addition to this, the finishing process and the employment of downstream and upstream
production are explained. The agile and lean strategies adopted by this luxury company have
also been explained.
Vertical integration:
Johnston of Elgin is the only last remaining mill of United Kingdom that is vertically
integrated. A full design and process of manufacturing is offered by the company where own
new product is developed by in house design team along with clients. All the process ranging
from raw material receipt to finishing product at single location is carried out by this
particular mill. Johnston is the only mill of Scotland that is vertically integrated and this is
indicative of the fact that it performs variety of things ranging from fiber to finishing garment
that includes weaving, spinning dying, milling and knitting. Everything involved in knitting
of garments took at one place and customers from big couture houses often come to work
jointly with Johnston and this helps in getting a sense of their responsibilities (Wisner et al.,
2014). The millionaire cashmere is made by Johnston that is used in bespoke garments in
Elgin. It is indicated by vertically integration that they process raw cashmere and nasty from
Mongolia along with weaving, spinning and knitting the yarn. Vertical integration helped
manufacturers in cloth in controlling their own yarn along with the process of dying as well.

LOGISTICS AND SUPPLY CHAIN MANAGEMENT
Mills that are vertically integrated are able to retained handlooms for weaving sheds of power
loom alongside weaving of pattern. Products that is manufactured by way of vertical
integration of Johnston include knitted accessories such as scarves, hats, socks and gloves
and knitwear and these products are developed using traditional frame knitting machine
(Mangan et al., 2016). Furthermore, all of the wool of Johnston is processed by Johnston
using the technique of vertical integration and this would enable the visitor to see the entire
process if they visit the Elgin site. All the production process ranging from carding, dyeing,
spinning, teasing, winding and twisting yarn alongside finishing and weaving wide variety of
cloths are accommodated in the vertically integrated woollen mill. Vertical integrated came
with several advantages to company with increasing capacity of spinning and lowering the
cost of operating mill. The market failure arising from nonexistent or irregular downstream
and upstream functions is addressed by the adoption of vertical integration (Brandenburg et
al., 2014).
Supply chain mechanisms and driving efficiencies:
The competitiveness of Johnston of Elgin can be dramatically improved by focusing
on improving the process of key supply chain. Scotland is a country that continues to supply
interior leather and fabrics that has demand all around the world. In light of some challenge
faced by supply chain management, there is growing importance of collaboration and
development of global supply chain. The ability of organization to compete is impacted by
raw material price fluctuation and fragility of supply chain. Cashmere being the unparalleled
luxury makes it among the fiber that is most sought in the world. Johnston of Elgin is the best
kept secret of Scottish textile as it has been harnessing for more than two hundred years. An
exquisite craftsmanship is exercised by company for bringing out the splendor in accessories
and garments reflecting heritage of true Scottish (Rushton et al., 2014).

LOGISTICS AND SUPPLY CHAIN MANAGEMENT
The only company with vertical integration on Scotland is Johnston that process the
raw fiber to the finished garments. At every point of production, measures of quality control
are enforced by company. Johnston for many years had been a predominantly men’s wear
business that manufacturers highly stable products having lifelong cycles (Wang &
Cullinane, 2015). With passing of time, company also developed business of women wear
having shorter life cycle and higher contents. Supply chain of organization was designed to
produce a product base that is more customized compared to producing products on repetitive
basis that is standardized. However, the products are manufactured in their own labels of
major fashion houses. Therefore, in the process of product development, design was regarded
as most critical element. Making company design led was viewed as providing powerful
platform enabling company to compete against low cost country sources (Jayaram et al.,
2016).
Johnston recognized the need of design that would become a source of differentiation
and the current design process of company was viewed as an inhibitor to greater agility. A
fixed cycle was followed by design process in spite of number of innovations that the
manufacturing sector has experienced. All this called for conducting review of the criticalities
of the process of supply chain for overcoming the problems witnessed by Johnston.
Organization was able to identify the opportunities for removing the bottlenecks and reducing
the non value adding time by using the process mapping (Grant et al., 2017). It was
recognized by them that they need to introduce an approach that is cross functional for the
purpose of making decision in the more fashion oriented market. Some significant
improvements were made in the existing process of supply chain management in terms of
reduction in time from receipt of order to final delivery. This was done partly through the
installation of system of enterprise planning along with continuous focus on improving the

LOGISTICS AND SUPPLY CHAIN MANAGEMENT
process. Despite the backdrop of challenging conditions of market, the company managed for
improving the profitability position (Tatoglu et al., 2016).
Employing, upstream to downstream production and finishing process:
Organization uses cashmere that is blended from fibers that is carefully selected from
China, Afghanistan and Mongolia. Performance of fabrics is optimized by different qualities
of these fibers that help in providing customers with best hand feel and durability on any
particular product. Goats that are herded in traditional ways are relied for extracting
cashmere. There are thirty different processes that are involved in the transformation of raw
fiber into luxurious finished products. The own mills of organization that is in the heart of
Scotland is responsible from yarning, twisting and stitching of raw materials to warping to
weaving. For dyeing of fiber in its natural state, there are four different effective ways and
over the years, the dedicated technicians of company have worked to make color in
accordance with raw material characteristics (Wang & Cullinane, 2015).
Production unit of organization has tried and tested practices that has enabled in
mastering the craft. It is ensured by such practice that highest standard of practice is carried
out before moving out to next stage. The finishing process of woven cloth involves many
processes for transforming cloth into the luxurious finished products and there have not been
many changes for hundreds of years. Fabric is scoured by using the natural and softest
Scottish water that ensures that water is stored to super soft and natural state. Process of
finishing such as raising, cropping and pressing prior to final inspection is carried out further
depending upon the use of fabric (Saenz & Koufteros, 2015). The product is made from
beginning to finish in Scotland and such products ranges from fabrics to accessories.

LOGISTICS AND SUPPLY CHAIN MANAGEMENT
Upstream is the fashion designers recipient who is interested in adopting textile
materials as instruments that helps in creating activities. Textiles are then sent to other
category by fashion designer to end users where shop is assumed as the first context and
accept them in the garment form. The physical contact of users with the textiles is defined by
channel in the lower one through the garment and upper level alone (Jacobs et al., 2014). At
the very beginning of textile material creation, textile design can go upstream.
Agile and lean logistic strategies:
Adopting the agile strategies in the logistic would enable an organization to thrive in
an environment of unpredictable and rapid change. In a highly competitive and constantly
changing business environment, it is required by organization to find an effective response.
Development of an agile operation would require minimal lead time so that there is high level
of availability of serving volatile customers. There are several distinguishing features of an
agile supply chain. It would help organization in responding to actual real time change in
demand that is market sensitive. In order for organization to react to possible fluctuation in
demand, the capability capacity must be acquired by organization. The crucial factor for agile
supply is usage of information technology that leads to sharing of data between suppliers and
buyers (De Villiers et al., 2017). Visibility of requirements by organization would be
improved using agile logistics along with reduction of any distorted demand and reduction of
amount held in anticipation of demand. The extended enterprise would be sustained by
sharing the information between partners of supply chain. Such supply chain also helps in
enabling activities of the common system and joint development product by making use of
collaborative alliances by supporting the information exchange. In an environment of
unpredictable and rapid change, an enterprise could thrive by employing agile strategies in its
logistics department. The highly competitive and constantly changing business environment,

LOGISTICS AND SUPPLY CHAIN MANAGEMENT
it is required by enterprise to find an effective response. Agile logistics has several
distinguishing features such as its ability to respond to changes in demand (Dubey et al.,
2017).
The lean logistic strategy in the management of supply chain intends to eliminate the
waste including time and thereby enabling establishment of level scheduled. It is possible that
significant delays for the delivery could be felt by customers despite the presence of facilities
of lean logistics in the supply chain. However, implementation of lean strategy would require
rapid replenishment of shipments and products for meeting the requirements in terms of
completeness of order, delivery time and accuracy. Textile industry is characterized by high
volatility, short lifecycle of product, high level of impulse purchase and low predictability
and such issues requires quick response that is of paramount importance (Prajog et al., 2016).
Employing lean strategies in logistics requires rapid replenishment of shipments and products
of clothing for meeting the requirements in terms of completing order, delivery time and
accuracy. Johnston of Elgin employs efficient lean practices that intend to design the
products that are demanded by customers. It helps in minimization of resources, time and
manpower. Any lead times experienced by organization would be reduced by managing the
process of manufacturing by supplying effective sequence using the agile and lean
approaches (Fernie and Sparks, 2014).
Recommendation:
Johnston of Elgin faced several issues in their supply chain management which made
challenging for the organization to maintain profitability. For the textile industry in which
Johnston is operating, suppliers are regarded as critical resources and in order to derive the
maximum amount of potential from the supply chain, it is required to efficiently manage their

LOGISTICS AND SUPPLY CHAIN MANAGEMENT
supply chain. Any identified problems should be structured systematically and comparison of
different suppliers should be made with respect to appropriate sub criteria and criteria.
Vendor selection should be done by organization by adopting process model of analytics
hierarchy. This calls for examination of significant number of qualitative and quantitative
attributes of suppliers.
Conclusion:
The report is prepared for demonstrating the supply chain management and driving
efficiencies of the operations of Johnston of Elgin. Vertical integration, finishing process and
downstream and upstream production process of organization have been evaluated. It has
been found that the issues faced by Johnston in their supply chain management have been
dealt by the adoption of cross functional approaches. In addition to this, the adoption of
enterprise planning system has led to significant improvement in terms of time reduction
from receiving of any order to its delivery. The process of analytics hierarchy would enable
organization to cope up with several criteria involving quantitative, tangible, intangible and
qualitative aspects.

LOGISTICS AND SUPPLY CHAIN MANAGEMENT
References list:
Brandenburg, M., Govindan, K., Sarkis, J., & Seuring, S. (2014). Quantitative models for
sustainable supply chain management: Developments and directions. European
Journal of Operational Research, 233(2), 299-312.
Cashmere Clearance | Cashmere Jumpers Sale | Johnstons of Elgin. (2018). Johnstons of
Elgin. Retrieved 31 July 2018, from
https://www.johnstonsofelgin.com/international/clearance.html
De Villiers, G., Nieman, G., & Niemann, W. (Eds.). (2017). Strategic logistics management:
A supply chain management approach. Van Schaik Publishers.
Dubey, R., Gunasekaran, A., Papadopoulos, T., Childe, S. J., Shibin, K. T., & Wamba, S. F.
(2017). Sustainable supply chain management: framework and further research
directions. Journal of Cleaner Production, 142, 1119-1130.
Fernie, J. and Sparks, L., 2014. Logistics and retail management: emerging issues and new
challenges in the retail supply chain. Kogan page publishers.
Grant, D. B., Wong, C. Y., & Trautrims, A. (2017). Sustainable logistics and supply chain
management: principles and practices for sustainable operations and management.
Kogan Page Publishers.
Jacobs, F. R., Chase, R. B., & Lummus, R. R. (2014). Operations and supply chain
management (pp. 533-535). New York, NY: McGraw-Hill/Irwin.

LOGISTICS AND SUPPLY CHAIN MANAGEMENT
Jayaram, J., Zailani, S. H. M., Tan, K. C., & Mohan, K. (2016). The influence of logistics
service supply chain management on logistics capability and logistics service
effectiveness in an emerging economy. Working Paper, University of South Carolina,
Columbia, SC, USA.
Mangan, J., Lalwani, C., & Lalwani, C. L. (2016). Global logistics and supply chain
management. John Wiley & Sons.
Prajogo, D., Oke, A., & Olhager, J. (2016). Supply chain processes: Linking supply logistics
integration, supply performance, lean processes and competitive
performance. International Journal of Operations & Production Management, 36(2),
220-238.
Rushton, A., Croucher, P., & Baker, P. (2014). The handbook of logistics and distribution
management: Understanding the supply chain. Kogan Page Publishers.
Saenz, M. J., & Koufteros, X. (2015). Special issue on literature reviews in supply chain
management and logistics. International Journal of Physical Distribution & Logistics
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Tatoglu, E., Bayraktar, E., Golgeci, I., Koh, S. L., Demirbag, M., & Zaim, S. (2016). How do
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Logistics Research and Applications, 19(3), 181-199.
Wang, T., & Cullinane, K. (2015). The efficiency of European container terminals and
implications for supply chain management. In Port management (pp. 253-272).
Palgrave Macmillan, London.

LOGISTICS AND SUPPLY CHAIN MANAGEMENT
Wisner, J. D., Tan, K. C., & Leong, G. K. (2014). Principles of supply chain management: A
balanced approach. Cengage Learning.