Richmond Business School: Supply Chain Report - Sainsbury Analysis

This report provides an in-depth analysis of Sainsbury's supply chain management, examining key aspects such as customer service, inventory management, transportation methods, warehousing, and capacity management. It explores the company's approach to customer service, including product availability and inventory strategies like safety stock and the Economic Order Quantity (EOQ) model. The report delves into Sainsbury's transportation modes, including shipping, delivery vans, and trucks, as well as its use of Logistics Service Providers (LSPs). Furthermore, it investigates warehousing and capacity management, highlighting their contribution to supply chain efficiency. The analysis critically assesses the company's strategies for achieving competitive advantages, considering the critical issues and problems within the organization's context. Finally, the report offers suggestions for improving Sainsbury's supply chain performance, based on the findings of the analysis.

SUPPLY CHAIN
MANAGEMENT
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TABLE OF CONTENT
TABLE OF CONTENT...................................................................................................................2
INTRODUCTION...........................................................................................................................3
CUSTOMER SERVICE AND INVENTORY................................................................................3
TRANSPORTATION AND LSP’s.................................................................................................4
Modes of transport.......................................................................................................................4
LSPs and 3PLs.............................................................................................................................5
Supply chain transportation managed differently from the demand distribution? .....................5
Efficient in supply chain transportation.......................................................................................5
WAREHOUSING AND CAPACITY.............................................................................................6
Warehousing contribute to supply chain......................................................................................6
Managing capacity be difficult....................................................................................................6
Efficiency is the supply chain in managing capacity...................................................................7
STRATEGY, COMPETITIVE ADVANTAGES & CONCLUSION.............................................7
Critically analysis of the findings................................................................................................7
Supply chain strategy to competitive advantage..........................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10
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INTRODUCTION
Supply chain management is the flow of end products and raw materials which are
coming in the company which has to be managed well. Active streaming has to be done which is
going to make the satisfaction level of the company be maximum and also make the business be
able to gain higher competitive advantage. Movement and storage of the products and services
has to be done effectively in the company in order to make sure that the company is having a
higher competitive positioning in market. Sainsbury is belonging from the retailing industry
which is operating since 1869 and is a public limited company. Headquarters are in London,
United Kingdom and us operating in a lot of countries and is having a net income of £152
million and there are more than 111,900 employees working in the company. The company has
gotten online as well so that the company would be able to make sure that there is going to be
higher operations and supply chain of the company will have to be improved effectively so that
there is going to be better competitive positioning. The report is going to discuss the customer
service inventory so that the company will be able to have good productivity, transportation &
logistic service provider and warehousing & capacity. The report is also going to discuss the
strategy and competitive advantages which the company can have when they use these factors
effectively in order to be able to match the demands and needs of the customers.
CUSTOMER SERVICE AND INVENTORY
Product and services available to the customers:
Sainsbury is the multinational company which have wide product portfolio which include
clothing footwear, home wear, gift items etc. company is known for good quality of products and
also provide good customer services (Singh and Verma, 2018). There products are always
available to customers because of it powerful supply chain management. Company make sure
that they never go out of stock because if they will go out of stock then their customers can get
shifted to their rival company. Sainsbury manufactured in bulk so that can satisfy their
customers. It also helps in building brand loyalty. This is the main reason that company can able
to retain their existing customers and existing customers bring new customers which increase
sales of the company. Company have stores nearby locations, customer buy from stores as well
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as company is also available online. So customer can buy from company's website as well (Pal,
2017).
Inventory methods adopted by Sainsbury so that availability can be improved and service
level of organization.
In order to improve availability Sainsbury use safety stock method. Safety stock means
when company store extra stock in their warehouse so that company will never go out of stock.
So that company can able to fulfil all demand. Safety stock also improvize company's image and
helpful in getting loyal customers. Rival company can take benefit of it, if company goes out of
stock but Sainsbury uses safety stock method which never allow to go out of stock. Company
store extra stock, so they do not have to rely on supplier for urgent supply. Safety stock protect
company from sudden stock demand (Riza and Purba, 2018). It also helpful in increasing sales
and revenue of company. Sainsbury manufacture their popular and frequently sold items more so
that they never go out of stock. Service level of Sainsbury is 95%. it can be said because
company consider their customer first, and they believe that customer will come again to
company only if they will get good services by company. Sainsbury also trained their employees
so that skills can be developed in workforce related to how to treat customers.
Sainsbury manage stock:
Sainsbury manage its stock with the help of economic order quantity (EOQ). It means
that company order in bulk which reduced its costs related to receiving and holding inventory.
EOQ helps company in reducing their costs per unit. It is a financial tool which help company to
controlling the cash by undergoing inventory balance. Inventory is important asset for company.
As loss of inventory can occur delay in production (Janssen and et.al., 2018). Delay in
production will lead to delay in supply. Due to this company can lose their existing customers.
So company manage their stock effectively.
TRANSPORTATION AND LSP’s
Modes of transport
Sainsbury is using different types of modes for transportation which includes shipping
containers, delivery vans, trucks, etc. These is done so that the company would be able to gain
the competitive advantage and make the right functioning to match the expectations, demands
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and needs of the customers (Boon-Itt, Wong and Wong, 2017). To be able to provide the stock in
the market effective and faster these transport modes are being used which is good for the brand
positioning in market. To be able to provide the products and services on time the company is
using airplanes and shipping methods which are going to make the material reach from one
location to another, anywhere in the world. To make the offerings be present and be higher the
company is going to use these modes which are beneficial for the company (Parsaeifa and et.al.,
2019).
LSPs and 3PLs
Logistic service provider is a process to make sure that the management for supply chain
is being developed and providing services which is going to be good for a workplace. There has
to be improvement and importance which has to be given to LSP which is going to make sure
that the audience is going to have higher satisfaction of the customers. managing the resources
and providing the supply of the people so that there is going to be good managed working which
is going to be present.
Supply chain transportation managed differently from the demand distribution?
Supply and demand distribution are very similar in an organization for transportation.
There is a common transportation mode which is present in supply and demand distribution
which has to be present and management of supply chain management has to be included that
there is going to be good for the brand image (Choi, Cai and Shen, 2018). To make the
processing of supply chain management there has to be an increase in brand knowledge and
supply knowledge so that there is going to be maximum number of efficiency which is going to
be present in Sainsbury. Quick access has to be present for the raw material and other aspects so
that the quality and transport factors of the business is going to be present which is good for the
working of the company which is good for a long run.
Efficient in supply chain transportation
Supply chain management is going to make sure that goals and objectives of the company
is being matched so that there is going to be higher efficiency which is going to be present. To be
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able to improve the supply chain management there are feedback and reviews which are going to
be taken from the audience so that they can be worked upon which is going to make the
satisfaction and brand value in the market be higher (Derwik and Hellström, 2017). Best of
transportation facilities are being used by Sainsbury to make sure that the results are going to be
higher and the company is being able to provide their services to the clients on time. Best quality
of services and results are present which is helping the company be able to deal with these
factors which is going to be good for the working.
WAREHOUSING AND CAPACITY
Warehousing contribute to supply chain
Raw materials have to be stored so that there are going to be higher understanding of the
availability which is going to be present of the products and services which are present in the
company is what is warehouse for in the company. Warehousing is very essential in a business to
be able to store and make the supply and transportation factor be higher in the company. To be
able to have longer period of the products and services in Sainsbury in warehousing so that there
is going to be higher working which is present in the company (Mosteanu and et.al., 2020).
Needs of the market and productivity is going to be dependent on the stock which is going to be
present and products and services. The services are going to be present in the market for a long
run which is going to make sure that the basic necessary items are being matched so that the
products and services of the company are going to match the satisfaction level of the customers.
Managing capacity be difficult
Managing the capacity of the business is very important so that the company is going to
make sure that the necessary requirements which is going to be present. There are five stages
which are present in management which are setting of goals, products and services, analysis,
strategy formation, strategy implementation and strategy monitoring so that there is good
management which is going to be present. To be able to have higher management capacity to
manage the working of the company there has to be effective points which have to be
considered. Five stages have to be followed so that there is going to be higher results which the
company is going to have which is good for the reputation and standards of the company which
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is going to make the achievement be higher (Tan and et.al., 2018). Security and capacity
management has to be present so that the requirements of the customers in the future are also
going to match which is going to be a good factor. In the worst of situations the company would
be able to match the demands and objectives of the company because of the stock which is
present in the company.
Efficiency is the supply chain in managing capacity
Supply chain management is a crucial measures which a business must have so that they
would be able to develop and implement better strategies to be able to manage the right working
and capacity of the business. Capacity of the organization is going to be promoted and make the
working of goods and services of the company is going to be higher as well when supply chain
management is going to be higher. Understanding the requirements and other aspects of the
company is important so that the material and managing capacity is going to be stable for higher
operations (Chen and et.al., 2017). Working of supply works properly and transportation factor
of the company is also well maintained then the capacity management is going to be effective for
future trades as well and managing factor is going to be higher. Better business goals and
objectives is going to be present which is good for the reputation of the company.
STRATEGY, COMPETITIVE ADVANTAGES & CONCLUSION
Critically analysis of the findings
Competitive advantage
To be able to gain competitive positioning in the market, Sainsbury is developing
effective strategies so that the company will be able to utilize their resources well. It is because
of the transportation services which the company is having their is good audience and
performance which the organization is having (Schniederjans, Curado and Khalajhedayati,
2020). There is a upper hand of Sainsbury in the competition which is present in the market
because the stock management of the company is high. using the resources which are required
for production is very important so that the company will be able to find stability in the market.
Transportation and warehousing of the company is strong so that there are effective services
which is going to be present and advantages of the company is also going to be higher. There is
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quick and effective delivery which the company is having despite of all the situations which rise
in the market for the business to keep growing effectively in the market.
Supply chain improvement
Current issues have to be addressed in Sainsbury so that the company would be able to
have higher improvement in the supply chain which is going to be present. Transportation is the
advantage of Sainsbury which the company is having which is making the company have stable
customers as well which are present making the supply chain management be present (Yu and
et.al., 2017). Warehousing has to be developed which would make the products and services of
the company be affected positively which is good for a long run. Strategies have to be developed
according to the objectives and goals of the company so that there is effective improvement and
the services of the business are going to make sure that the aims and objectives of the company
are being matched on time.
Supply chain strategy to competitive advantage
For the supply chain their are different strategies which are being followed by Sainsbury
to make sure that there is effective working. Supply chain management is essential for the
business to be able to operate effectively. Sainsbury uses supply chain strategies which are
customer centric and smart automation which is good for the reputation of the company. Best
supply chain is going to make sure that the company is going to have higher operations and
working which the company must have (Fatorachian and Kazemi, 2021). Sainsbury is being able
to have higher operations and revenue generation which is a great factor for a long run.
Centric of customers strategies are being followed in Sainsbury which is going to make
the business profits be higher which is going to make the services of the customers. Improvement
of the customers and satisfaction has to be higher and sustainability and advantages in the
market. better performance for the customers has to be present so that the company is going to
have higher functioning and business towards the market competition which is going to make the
objectives and goals of the company be higher which is a great factor. Planning and
segmentation for delivery has to be present and focused upon so that the promotions of the
company is also going to be present making the company be able to work effectively (Aich and
et.al., 2019).
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To match the competitive sustainability in the market Sainsbury is using strategies like
smart automation which is going to make the sustainability and advantage of the company be
higher.
CONCLUSION
From the above report it is concluded that supply chain management is very important for
the productivity and operations of the raw material and end product be present. Company has to
make sure that the organization is being able to find higher functioning and operations which is
matching the demands and standards of the customers from time to time. The company must use
just in time for supply chain in order to be able to maintain their warehousing and other factors in
the organization to be able to have higher functioning and improvement which is going to be
present for a long run.
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REFERENCES
Books and Journals
Aich, S and et.al., 2019, February. A review on benefits of IoT integrated blockchain based
supply chain management implementations across different sectors with case study.
In 2019 21st international conference on advanced communication technology
(ICACT) (pp. 138-141). IEEE.
Boon-Itt, S., Wong, C.Y. and Wong, C.W., 2017. Service supply chain management process
capabilities: Measurement development. International Journal of Production
Economics. 193. pp.1-11.
Chen, S and et.al., 2017, November. A blockchain-based supply chain quality management
framework. In 2017 IEEE 14th International Conference on e-Business Engineering
(ICEBE) (pp. 172-176). IEEE.
Choi, T.M., Cai, Y.J. and Shen, B., 2018. Sustainable fashion supply chain management: A
system of systems analysis. IEEE Transactions on Engineering Management. 66(4).
pp.730-745.
Derwik, P. and Hellström, D., 2017. Competence in supply chain management: a systematic
review. Supply Chain Management: An International Journal.
Fatorachian, H. and Kazemi, H., 2021. Impact of Industry 4.0 on supply chain
performance. Production Planning & Control. 32(1). pp.63-81.
Janssen, L. and et.al., 2018. A stochastic micro-periodic age-based inventory replenishment
policy for perishable goods. Transportation Research Part E: Logistics and
Transportation Review. 118. pp.445-465.
Mosteanu, N.R and et.al., 2020. Sustainability Integration in Supply Chain Management through
Systematic Literature Review. Calitatea. 21(176). pp.117-123.
Pal, K., 2017. Supply Chain Coordination Based on Web Service. In Supply Chain Management
in the Big Data Era(pp. 137-170). IGI Global.
Parsaeifar, S and et.al., 2019. A game theoretical for coordination of pricing, recycling, and green
product decisions in the supply chain. Journal of cleaner production. 226. pp.37-49.
Riza, M. and Purba, H.H., 2018. The implementation of economic order quantity for reducing
inventory cost. Research in Logistics & Production, 8.
Schniederjans, D.G., Curado, C. and Khalajhedayati, M., 2020. Supply chain digitisation trends:
An integration of knowledge management. International Journal of Production
Economics. 220. p.107439.
Singh, D. and Verma, A., 2018. Inventory management in supply chain. Materials Today:
Proceedings. 5(2). pp.3867-3872.
Tan, B and et.al., 2018, December. The impact of blockchain on food supply chain: The case of
walmart. In International Conference on Smart Blockchain (pp. 167-177). Springer,
Cham.
Yu, Y and et.al., 2017. E-commerce logistics in supply chain management. Industrial
Management & Data Systems.
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