Sunday, August 25, 2019

Summary of what is the right supply chain for your product Essay

Summary of what is the right supply chain for your product - Essay Example For Innovative products, many companies introduce innovation to give customers an added reason to purchase their products. Innovative products give a company higher profit margins, but their demand is very unpredictable, their life cycle is short. Because of their high-profit margins and unstable demand, innovative products necessitate a special supply chain than functional products. Supply chain has two different functions: these include physical and the market mediation function (Fisher, 112). The supply chain physical function includes converting raw materials into parts, components, and transferring all of them from one position in the supply chain to the next position. Market mediation ensures that the variety of products reaching the market matches what the consumers want to buy. The predictable demand of functional demand products makes market mediation simple because it nearly achieves a perfect match between supply and demand. Uncertainty is intrinsic in innovative products, and companies accept that, but companies that grew up in oligopoly with less competition find it more difficult to accept the high levels of uncertainty that exist today in many

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