There are 6 recent trends influencing the supply chain around the world. Besides, Technology has brought a revolutionary change in our life along with business organization. The most influential change we found was in supply chain management. Let’s see some recent trends influencing the supply chain around the world.
- Proliferation in the product line
Proliferation means having the newer and newer product in the marketplace. Marketers are gradually changing their product features, size, and quality based on customers’ tastes and preferences. Because customers are the main source of earnings. Customers have much information regarding substitutes or competitors’ products. So, if you don’t give your customer higher satisfaction, they will leave you.
At present, today’s marketers are finding growing changes in customers’ needs and preferences. The customer’s ever-growing demand is increasing. That’s why every company is managing their high stock keeping unit. Because SKU indicates the Proliferation in the product line of a company. Does this SKU contain how many products are there? How many varieties are there? So, as a market specialist, you need to find it out. Because, who has a higher SKU, his supply chain is much more strong than others.
- Shorter product life cycles
Competitions are increasing day by day. Besides, the customer’s ever-growing demand is also increasing. So to stay with the market, marketers need to innovate newer and newer products to fulfill the customer’s demand. That’s why the product life cycles become shorter. There is another reason for it. This is technology. Technological development is a great challenge right now.
So two influential factors for shorter product life cycles are-
Think about the telephone war. iPhone stays in the marketplace for nearly 6months. But others like Xiaomi or other Chinese producers change their products within 6 months. Besides, they don’t have any distribution channels. They only sell online.
- High level of outsourcing
There are two levels of outsourcing. Have a look –
- Core competencies – (in-house): Core competencies are used to differentiate one company from another company. For example, Nike. Nike is a shoe-making company. Its core competency is its unique design.
- Other activities – (outsource): Although Nike has a unique design, its others activities are done by the other company(outside of the company).
Think about Xioami’s marketing and product development strategy challenges. It is going on high outsourcing. Besides, it has a high vulnerability to competitors. Because today’s suppliers of Xioami may not all time to them. Competitors may grab these suppliers by their money power. Then Xioami may fall in danger.
- The shift in the power structure
Middlemen are restoring their power through brand development whereas consumers are becoming more informative. A company collects its necessary raw materials from suppliers. Then the company goes into production. After producing products, they reach the final customer through middlemen. Because the middlemen have direct interaction with the customer. The food producers have little connection with customers.
That’s why the food producers are mostly depending on middlemen to bring their products to the final customers. This was the last scene of the business organization. But day to day, middlemen also become very powerful. They are helping a company to build its brand. Because customers’ tastes and preferences are gradually changing. The customer wants more and more variety of products with higher satisfaction. The brand creates differentiation from other products. Moreover, the brand is a source of confidence.
- Globalization of manufacturing
Globalization is the main recent trend that influences supplies chain around the world. There is a minimum trade barrier that represents low supplies cost. So, where producer finds globally low trade barrier, where they established their production plant. And they globally export their goods with minimum trade barriers.
- Data visualization
It is a great challenge for the supply chain management. Every party needs to be connected online. So that they respond quickly to each other. But sometimes it is hard to maintain this data visualization.
So, hopefully, you guys understand the changing nature of the supply chain because of technology. More specially, after reading this, you will also understand the 6 recent trends influencing the supply chain around the world