Before heading towars the main topic we must know something about “Logistics”, which is a major part of Supply Chain Management as explained by The Council of Supply Chain Management. It describes that a section of the supply chain is based on the procedure of effective planning, execution, and controlling tasks and working on stocks of goods and services. It also defines the process of surveying and gathering information about the related goods and services (from manufacturing point to consumption point) (Christopher, M. (2016). Logistics & supply chain management. Pearson UK.). In this report, I have selected Samsung Electronics as the manufacturing industry and I will be explaining in detail about this company below.

  1. The principles help the managers to manage the logistics and supply chain management which means it helps to regulate the flow of the products. It also assists to manage and focus on the profitability, income, and asset consumption of the company. The principles are discussed in detail below:

  • PRINCIPLE 1: Categorize the customers depending on their preferences in a supply chain and categorize the company's profitability based on the demand and supply. By categorizing these standards the company gets to divide the cases equally and develop profitability ("Integrated Logistics | Global 4PL services | Samsung SDS", 2020). For example, Samsung Electronics categorized the ranges of mobile phones based on customer preferences. Some customers prefer phones according to the camera quality and their megapixels but some customers prefer mobile phones for gaming purposes. Therefore, Samsung categorized these ranges of products based on the preferences of the customers. They launched Samsung Note 9 and 10 plus for higher camera quality and battery longevity whereas Samsung launched the “M series” for gaming purposes.  

  • PRINCIPLE 2: Providing and adjusting the logistics network categorizing the segments based on growth and profitability is the second principle for the supply chain management. For example, Samsung Electronics launched the "J series" in mobiles which consist of various features that every customer can prefer. The "J series" has an average camera quality, battery longevity, go-to mobile for gaming purposes, and the price range is reasonable.

  • PRINCIPLE 3: Listening to the market calls and preparing demand schedules as per the supply chain and getting proper resources is the most important principle of supply chain management (Grant, Wong & Trautrims, 2017). In the case of supply chain management, forecasting and prediction have always been set and improved step by step, which included various groups made for the same product according to the measures, demand, price rate, and assumption of the managers and other members. For example, Samsung is profitable for investment because there cited price for the month of august is 51100.00 KWR. As per the forecast, the company can predict the increase in supply chain and profitability. The investment for 2020 predicts the investment and revenue as per the stock exchange for the next five years ("Integrated Logistics | Global 4PL services | Samsung SDS", 2020). Therefore, the future price as per the stock exchange becomes 93576.90 KWR.

  • PRINCIPLE 4: Determining and making a distinction as per customer taste and converting the supply chain is another pivotal principle that helps to determine various products based on customer's preferences (Govindan, Cheng, Mishra & Shukla, 2018). Previously, the manufacturing unit used to produce products as per the level of production by the demand of the goods and by forecasting based on the stock of the goods stored in the warehouse. This process made the manufacturing unit work on a single plan of converting the raw materials into finished products and pursuing customer satisfaction. Though, this technique has helped in cutting the cost level and reducing the set-up costs. For example, Samsung introduced every single product based on customer requirements and TV's, Monitors, Ac's, refrigerators, and Washing machines ("Integrated Logistics | Global 4PL services | Samsung SDS", 2020). The products are manufactured based on the requirements of the customers which helps to cut the cost level and manufacture go-to products.

  • PRINCIPLE 5: Regulating the resources for raw materials so that the total cost of the product reduces and the supply chain is managed. For example, Samsung manufacture products by regulating the resources for raw materials as they have numerous amount of suppliers which reduces the total cost of the product.

  • PRINCIPLE 6: Developing a wide range of supply chains for determining the various level of planning and making the decision in case of the supply of products and services (Wamba, Gunasekaran, Papadopoulo & Ngai,2018). This principle involves three important aspects that help to run a wide range of technology for supply chain management successfully. These aspects are analyzing strategy, decision making, and operational management. For example, Samsung Electronics launched the J series on mobile phones in a wide range because of the profitability of the company. The J series is an average costing with fulfilling customer requirements mobiles which helped to run a wide range of technology for the supply chain management.

  • PRINCIPLE 7: Endorsing the channeling process for selling the product is the final principle to conduct a successful supply chain management (Jabbour et al. 2019). In this case, the final step is to enhance or embrace the technology so that the channeling between the company and the customer is not compromised. By embracing the channeling process the customer can get the products up to its expectation and the company will reach the level of maximized profit. For example, Samsung electronics successfully maintain the process of channeling by providing proper distribution channels and using a wide range of technologies (especially for mobile phones).

  1. The supply chain of management is a procedure that includes various key drivers for making proper planning and strategic decision making. It helps the managers to make a structure based on the company's profitability and the supply of goods and services. The key drivers are as follows:

  • TRANSPORTATION: Transportation is an important key driver because it implies the sense of responsibility and measures how effectively and efficiently the tasks are performed in a supply chain. A quick supply of the products helps the company to improve the level of responsibility and depending on the mode of transportation the profitability can be measured. If the company has a high sense of responsibility and is intact in the competitive edge of the market then the customers will pay according to the level of the task. For example, Samsung Electronics made a recent launch of A series on mobile phones which nearly has similar features with the J series. Both the series have shared the same features and customer requirements. These products are transported in a wide range so that it can be supplied to every desired customer and the customers are willing to pay for it. Samsung uses all types of transportation routes to make an effective and efficient supply chain.

  • MANAGING INVENTORY: Inventory gets piled up in the warehouse if a disturbance (do not match) occurs in the level of supply and the level of demand. The different components for managing inventory are cycling, sourcing, secure and seasonal management of inventory (Yu et al. 2016). It also has the advantage of making the company complete its task with more responsiveness and effectiveness in the competitive edge. For example, Samsung works more effectively and efficiently than other electronic companies because they keep their piled-up inventories in a warehouse that is situated nearly to the customers.

  • FACILITIES OR DECISION MAKING: An efficient supply chain is made by creating an effective structure with systematic and strategic planning and making a proper decision. Decision making helps the production unit to provide the facilities like location, capacity, and warehouse manifesto in a balanced manner (Yazdani, Zarate, Coulibaly & Zavadskas, 2017). For example, Samsung electronics gear up and provides valuable facilities which in turn helps the company to attract more customers to gain profitability.

  • INFORMATION IN SUPPLY CHAIN: Information helps the company to gather data and feedback from the market at every step of the supply chain. The profitability is set according to the feedback and the information collected from the supply chain. For example, the lower-level management of Samsung Electronics has to collect and gather information from the market and forward it to the top-level management so that they can calculate the profitability and manage the supply chain.

  1. Supply Chain Management comes with various benefits that are effective for the company. In this report, I will be explaining the benefits of Supply Chain Management in Samsung Electronics. They are:

  • Improvised and ran finished goods: A vital signal to improve production efficiency is to complete the task as quickly as possible and satisfy the customer. If the customer gets the desired product within the provided time with good quality material then the customer gets satisfied. Likely, Samsung Electronics provides and efficiency in the production of the product as well as delivering the product to the last customer. Samsung uses various means or channels of distribution through which they can deliver the product to the customer and satisfy customer requirements. Moreover, effective supply chain management smoothens the production running with the process of forecasting and logistics networking which increases the present and future profitability.

  • Logical run of information: Supply Chain Management not only tends to run good quality of materials but also tends the lower level management to provide and gather information regarding the products and their sale (Tu, 2018). Samsung Electronics pursue systematic and strategic planning and makes a decision and includes the lower level management for the duty of collecting and gathering the information from the market based on customer's level of satisfaction and sale of the product. The lower level management performs a survey in the market and gathers information from the customers and the retailers. After completing the research they forward the reports and other information to the top-level management to measure the profitability of the company which in turn helps the company to remain competitive in the market.

Samsung runs in the market with the help of logistic marketing which is a part of Supply Chain Management. Samsung SDS is the third-highest logistics company that provides high-rated technology and sustainable operational activities.


  1. Supply Chain Management is a process that is based on the whole marketing process which includes producers, distributors, retailers, and finally the customers. The manufacturers set some basic objective that helps them to achieve the desired goals. These objectives are as follows,

  • To increase the total generation: The task of Supply Chain Management is to determine the difference between the selling price to the customer and the manufacturing price. Profitability increases if the supply chain is balanced properly (Abdirad & Krishnan, 2020). The supply chain is balanced with proper decision making and systematic planning which helps the supply chain management to achieve the desired and targeted goals.

  • To find out resources for net income and growth: Supply chain management has its only resource that is the consumers. Proper management of the supply chain with the run of adequate information helps the company to improve its cost efficiency, quality of material, a period of delivery or order, efficient performance, and running the supply chain effectively. Proper supply chain management also helps the company by enhancing the level of adequacy and making a perfect decision (Sweeney, Grant & Mangan, 2018).

Similarly, logistics management has a similar objective to that of Supply chain management because logistics management is a part of supply chain management. Its objectives are to maintain and run the supply of the customer within the assigned period at the proper and adequate quality and quantity. Its objective is also to deliver the product to the desired and allotted location in the shortest time and provide it to the customer at the least cost.

  1. The company introduced an imposing approach known as logistics networking which helps to manage and strategically organize their stocks, inventories, import, and export. Logistics networking has also helped the company to introduce such products in the market which consists and satisfies an average preference and needs of all the customers (Garver, 2019). Logistics consists of different modes of transportation where the company uses the technologies to deliver the products to the end customer. In the case of Samsung, the modes of transportation and logistics are maintained by Samsung SDS which is a subsidiary of the Samsung group. In Samsung, logistics is useful as it used three main and different modes of transportations. They are,

  • Marine transportation: Marine transportation is used to deliver goods to different countries through ships. Samsung has an association with other logistics organizations and world-wide ocean shippers so that the products can be shipped from one country to another country securely. But, Samsung uses marine transportation for delivering the goods when it comes to the lower rate of transportation cost because marine transportation takes time to ship the product from one country to another. That's why they charge low cost than airways and roadways.

  • Air transportation: Air transportation is an important mode of logistics because when it comes to faster delivery of finished goods or raw materials, airways plays a huge role. Airways are mainly used to transfer merchandise from one state to another state. But, sometimes if the product's demand touches the peak line air transportation can also be used for country-to-country basis. Samsung group uses air transportation to transfer goods or merchandise from one state to another as it delivers the products way faster than marine transportation or rail transportation. But, air transportation is more expensive than marine, road and rail transportation.

  • Rail Transportation: Rail transportation is a mode of transportation that is got-to for inter-state transportation. Rail transportation is used to transfer the merchandise within the cities and towns so that the products can reach its final destination. Samsung transfer the goods from city-to-city and within the towns with the help of rail transportation so that the customers receive the product within the promised period ("Integrated Logistics | Global 4PL services | Samsung SDS", 2020). Rail transportation is also sometimes used by Samsung for transporting goods from one state to another state as the cost of rail transportation is less than air transportation and it also delivers the products fast (not faster than the airways).

There are various types of logistics like, procurement logistics, product logistics, project logistics, sales logistics, and recycle logistics that are used in the supply chain management of a company. Samsung group uses Project Logistics to run the supply chain management of the company. Project logistics is used by Samsung because it helps the company to transport a huge number of merchandise together safely. Project logistics reduces the level of transportation cost by using various equipment for transporting. Samsung selected project logistics because they can transport a heavy and large number of products through the air and marine transportation with safety assurance. 

  1. While selecting the process of project logistics Samsung faced various problems in the beginning. Projects logistics affected the cities which were still socially developing because of various transportation system which was not improvised in those cities. It also affected the entire ecosystem because there was an execution in planning the viability of supply chain management. Project logistics also played a harsh role in case of profitability because many cities were not developed socially due to which there were only two modes of transportation available (roadways and railways). This was used to increase the rate of transportation cost and shipping cost which in turn reduced the graph of profitability at the beginning of the business. Gradually, when the cities and towns started developing economically and socially project logistics became a crucial part of supply chain management at Samsung. The graph of profitability started increasing and now the company has achieved the desired goals and reached the targeted profit. 



  1. Supply Chain Management comes with various strategies that every company follows to achieve the desired goals. There are seven different strategies that a company must follow to run supply chain management logically. The strategies are as follow,

  • Start being practical and manageable: this strategy makes the managers or the production unit to think practically but not conceptually because if the manager thinks practically and set plans and make decisions that will balance the supply chain and help in cost management (Hackius & Petersen, 2017).

  • Regulate the supply chain by focusing on the consumers: The supply chain should be conducted in such a pattern so that it completely focusses on the preferences of the consumers. While managing the supply chain the production unit must focus on the requirements of the consumers which in turn will increase the profitability and growth of the company. Customers are categorized by their taste of preferences depending on products, industries, and trading. Managers also categorize the company's profitability based on the supply or demand of the products and also by dividing or average the costs of the products.

  • Listen to CEO’s plan: The production unit must listen and apply the CEO's plan because to run the supply chain smoothly and gain profitability all the management must work simultaneously (top, middle, and low management).

  • Regulate trading among price rates and services: the company must balance between price rates and services because if the rate service increases then the price rate will fall resulting pile-up of inventories in the warehouse and an unbalanced supply chain (Zijm, Klumpp, Regattieri & Heragu, 2019).

  • Communication between the main stakeholders: the company must also focus on its stakeholders because if there are an unbalanced supply chain and piled-up inventory the profitability of the company may decrease which in turn can result in losing the stakeholders of the company.

  • Customizing the products: To run a perfect and balanced supply chain the company must customize the product as per the customers' preferences and look after the price rates of the products so that the supplies increase along with the demand resulting in positive relation and profitability.

  • Determining between risks and profit of the company by associating with variations in business realism: The company must follow on gathering the information from the market and must not lose any track so that the information of the market research gets leaked. If the information gets leaked then the supply chain of the company is compromised (Kherbach & Mocan, 2016). It becomes a risk for the company in a competitive market. Moreover, the company must change its technologies and use various business realism so that the company and its profitability can be a stick in the competitive market. 

Samsung executes four types of strategies which include regulating the supply chain by focusing on the consumers, customizing the products, listening to the CEO's plan, and Determining between risks and profits and associating with the variations in business realism ("Integrated Logistics | Global 4PL services | Samsung SDS", 2020). 

  1. Supply chain management and its strategies spotted and benefited Samsung in various ways. Samsung implemented strategies that mainly focused on customer preferences. But, these strategies also helped the suppliers in various conditions, such as;

  • Developing goals of the business: Samsung developed their desired goals by understanding the procedure through the products gets transferred from the manufacture to the customers. This improvised the relationship between the company and the wholesalers and retailers.

  • Analyzing the previous data of the company: Before managing the supply chain developing goals Samsung analyzed their place in the market and stock exchange from their previous data. After analyzing the managers along with the production unit of Samsung started working on the supply chain to achieve business goals and develop a relationship with their suppliers.

  • Information about the inventory and knowing consumers' tastes: Samsung improvises their relationship with the suppliers so that they can gather the information about the taste and preferences of the consumers according to which the production units of Samsung can customize the products. The suppliers also provide information about their piled-up stocks (inventories) in the warehouse helps Samsung to run and manage supply chain accordingly.

  1. Supply chain management and project logistics have improved the business of Samsung in various ways. According to project logistics Samsung improvised the modes of transportation as it used to follow three modes of transportation but form 2019 Samsung has also started using the roadways for transporting the products from one city to another city. Moreover, project logistics created a lot of economic and social problems but along with the time cities became developed socially and economically which in turn became a profit for Samsung, and the cost of transportation was reduced, therefore, they can securely ship the products. Supply chain management helped Samsung to produce finished goods focusing on customer preferences ("Integrated Logistics | Global 4PL services | Samsung SDS", 2020). It also helped the company to improvise its profitability and develop trust and relations with the customers. The customers received the products within the assigned period with the correct quantity and best quality. Supply chain management also helped Samsung to balance the price rates of the products and gain more profit by increasing the number of customers.


Information is an important key driver because it is the survey that is performed at every level of the supply chain. Unlike inventory, transport, and production facility, information is not physical. But, the improvement in information technology-enhanced the supply chain management system by improving the marketing approach and by developing marketing research. Nowadays, all three management of a company works simultaneously i.e. the top-level management gives the instruction the middle-level management to guide the lower level management so that the employees under lower-level management can go on a survey and collect feedback and reviews about the products from customers and the retailers (Christopher, 2016). Then, that information is gathered by the middle-level management and forwarded to the top-level management to decide and measure the profitability of the company. This was the traditional method which is still implied by the company. But, enhanced information technology has increased the level of marketing research without going into the field. Every company has introduced feedback and survey portals through the internet where the customers can provide feedback and their preferences about the products. This process has developed the level of marketing approach and marketing research in every company. Therefore, integrated supply chain management has been improvised by the development of information technology in the competitive market.


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