Industries »Chemicals & Fertilizers
Chemicals & Fertilizers
Chemicals and Fertilizers industry have their own set of characteristics which make their supply chain unique in many ways. Commoditization of products which leads to no products remaining unique for long, globalization putting pressure for cutting costs, hydrocarbons and energy cost spikes, retailers and consumers demanding lower prices, environment – health - safety pressures continuing as strong as ever, are some of the challenges which the industry faces today. To meet such challenges and remain competitive, supply chain of such industry needs to be responsive and optimally designed.
Plant operation is one area where there are lots of inefficiencies prevailing. Even the best plants do not have more than 80% of capacity utilization. Much of the capacity in the reactors, tanks and storage houses remain empty throughout the year. Supply chains of these firms are full of redundancies leading to a lot of duplicate assets, working capital and extensive time and human effort. Sourcing has become a critical activity which acts as the driver of high performance. There is a need to conduct strategic sourcing initiatives and using supplier management methodologies to build relationship with the suppliers. Chemical companies have to develop distribution networks to meet the service commitments they've made to their customers while minimizing inventories. They may also have to work within the structural constraints of their business, being far from customers and raw materials and utilizing older, more expensive production assets.
We at Aqua MCG realize that there are no easy fixes to the challenges offered by the industry but with our expertise and understanding of the issues plaguing the industry, we are confident to provide solutions, adding value wherever we are engaged.
Last Updated On:10/10/2008 7:50:54 PM
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Industries »Electronics, High Tech & Telecommunications
Electronics, High Tech & Telecommunications
This is a highly innovation-centric industry where the product lifecycles tend to be short. The focus of this industry is on products which deliver better performance, high speed communication and energy efficient products. Outsourcing of manufacturing to contract manufacturers or Electronic Manufacturing Services (EMS) has become an important part of the supply chain in the last two decades. Energy efficiency has become one of the important aspects due to the dangers of global warming. Also more and more companies globally are moving to a supply chain model which produces minimum waste and pollution.
Industry Characteristics:
Complex multi-tier supply chain network, consisting of raw material suppliers, manufacturers, co-packers, distribution centers, retailers and consumers.
Short product life cycles· Global suppliers and distribution
Assembly intensive manufacturing
Customer satisfaction is the main objective (OTD and fill rates)
Rapidly changing demand signals
Issues/Pain Points
Components
Suppliers catering to wide range of products
Stiff competition amongst suppliers
Increased risk of supply due to international sourcing
Product obsolescence
Last Updated On:10/23/2008 12:11:56 PM
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Services »Impact »Revenue Growth
Revenue Growth
A tighter supply chain brings down logistical costs and increases efficiency. In the upstream, it leads to more predictable demand forecasts leading to an optimum level of inventory and lesser wastage. In the downstream, it helps to create accurate supply schedules for retailers and end consumers. Aqua MCG looks at ways to streamline your supply chain and boost revenue growth.
In the past, firms simply used their supply chains as a means to control costs by improving efficiencies but now, they are using their supply chains as a mechanism to boost revenue and improve customer satisfaction through reduced turnaround times and better management of highly customized products. Shorter life cycle products, global competition and rising commodity prices have posed challenges for the firms to grow their revenues and increase product’s market share but at the same time, product development, better management and more integrated services provide huge opportunities.
Some of the supply chain domains where revenue growth can be achieved are:
Domain
Capabilities
Decision Drivers
Product Development
New product introduction
Economies of scaleo Capital investment analysis
Planning of capacity with the new product introduction and existing infrastructure
Last Updated On:10/16/2008 2:48:48 PM
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INTEGRATED SUPPLY PLANNING
The fifth element is a synchronized supply planning processes, integrated at one end with its internal consumers,manufacturing and logistics, and at the other end, with all suppliers. Supply Planning consists of numerous initiatives such as Supplier Rationalization, Vendor Managed Inventory and Consignment Processing. While it is important to achieve optimal demand-supply matching at the downstream end of the supply chain as discussed under S&OP earlier, it is equally rewarding to have a similar demand-supply matching at other end too. In this case demand would be the requirements from manufacturing functions and supply would be external suppliers or internal component manufacturing units. Based on end customer demand signal, production plans and material requirements plans are firmed up. These material requirements usually partially filled up by existing inventory but the rest comes from fresh procurements. Supply Planning targets this function to achieve increased efficiencies and reduced costs.
Supplier Rationalization: More often than not, a firm may have more suppliers than it may actually need. As firms grow the number of suppliers also increase, usually because of diverse purchase requirements and lack of control over supplier approval process. Obviously during growth phase these aren’t areas that attract a lot of executive attention, but as operations stabilize supplier rationalization presents a good opportunity for cost reduction. This program targets to achieve an optimal supplier base for the firm based on its requirements and delivers benefits both from a financial and business process perspective. Some specific benefits include – increased spend leverage, reduced procurement overheads and better relationships with suppliers. On the flipside, this program can increase dependence on a smaller set of suppliers and may impact the competitiveness amongst
suppliers.
Vendor Manag
Last Updated On:7/11/2011 6:49:04 PM
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Free trade zones / Special Economic Zones in India
The term: FTZ / SEZ
A Special Economic Zone (SEZ) is a geographical region that has more liberal economic laws than the ones generally followed in the rest of the country. The category 'SEZ' covers a broad range of more specific zone types: Free Trade Zones (FTZ), Export Processing Zones (EPZ), Free Zones (FZ), Industrial Estates (IE), Free Ports, Urban Enterprise Zones and others.
A FTZ (Free Trade Zone) is a particular area of a country where normal trade barriers & requirements like taxes, tariffs, and quotas are either eliminated or reduced, to attract businesses & investment. FTZs are usually characterised by labour intensive manufacturing set-ups that involve a high level of imports & exports. These kinds of zones are mostly prevalent in developing nations, and further in under-developed regions of that nation. In India, FTZs are seen as those areas where goods maybe landed, handled, manufactured or reconfigured, & re-exported without much intervention from customs authorities. Only when the goods are moved to consumers in the rest of the country, do they become subject to the prevailing customs duties.
With a view to overcome the shortcomings experienced on account of the multiplicity of controls and clearances; absence of world-class infrastructure, and an unstable fiscal regime and with a view to attract larger FDI in India, the Special Economic Zones (SEZs) Policy was announced in April 2000. This policy intended to make SEZs an engine for economic growth supported by quality infrastructure, attractive fiscal package, both at the Centre and the State level, with the minimum possible regulations.
The Cochin SEZ
FTZs / SEZs: India
In India, the setting up of SEZs can be done by the public, private, joint sector or by State Governments. Some of the existing Export Processing Zones (EPZs) have also been converted into Special Economic Zones:
Last Updated On:7/12/2011 11:17:10 AM
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