Supply Chain on a B2b Site Compared to a B2c Site

Supply Chain Paper

Introduction

A supply chain is the end-to-end processes that start with creating and developing a product or service and it ends when the final product or service is delivered to its users. These processes start from the suppliers of raw materials and end at the end users. Supply management is responsible for forecasting and managing demand as well as for getting the materials and parts, scheduling production, manufacturing, assembly, testing, inventory storage, distribution, and delivery. The supply chain has a complex infrastructure that consists of the following components: Planning, Production, delivery logistics and return processing. All of these components consist of many other sub-components that are essential for a successful supply chain process. This paper will discuss how the internet enhances the supply chain process and will explain how the supply chain process differs from a B2B site to a B2C site.

How the Internet Enhances Supply Chain Management

Supply chain management depends greatly on how efficient the communication flows between all the parties involved in the chain. The Internet is playing a major role on aiding companies with this process. The Internet and the Web allow companies to manage the details of their own internal processes as well as the processes of other members of their supply chains. Members using the software can see past performance, current performance and even predict product production. By using the Internet in supply chain management firms can:

• share information about customers’ demand

• receive quick notifications on product design changes

• increase the speed of processing transactions

• reduce administrative overhead

• reduce unnecessary inventory

• eliminate obsolete business processes

• reduce error in entering data

Supply Chain Differences between B2B and B2C

The steps on a B2B supply chain differ somewhat from those of the B2C chain. B2B in many cases uses extranets by which all members of the chain and suppliers are able to see stocking levels and inventory. B2B supply chain includes the purchase of direct materials (raw materials and components that are used for manufacturing products) while B2C supply chain includes the purchase of the final product by the consumer. The consumer gets the final product and does not have to buy the raw materials that the product is made from. B2 B materials flow from raw inputs to finished goods and it can change hands many times whereas B2C only gets the finished product. Here is an example: A lady goes to Gap website and buys a swimsuit. The lady, who is the customer, just clicks at the swimsuit icon she likes, pays for it and gets it a few days later. On the other hand, Gap has to buy the fabric (raw materials) from any of its suppliers and then follow other chain steps (production, etc) before it can feature the swimsuit that the lady bought on its website. Gap and its suppliers practice B2B e-commerce while Gap and the lady practice B2C e-commerce. Relationships are extremely