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SUPPLY CHAIN MANAGEMENT
Introduction
The following assignment will provide information related to the supply chain of Samsung. It will also portray the sustainable logistics issues which Samsung faces. The below-discussed job will also report about the inbound and outbound logistics of Samsung. The information will also provide knowledge about how Samsung implements strategic ideas to reduce greenhouse gases in the environment to make environment pollution free. The difference between the third-party logistics and fourth-party logistics service will also be discussed in the below assignment. The assignment will also provide a clear view of what type of logistics service does Samsung use to increase the efficiency of the company. The below-discussed information will also provide information related to reverse logistics and how it creates a problem in the company.
Issues associated with sustainable logistics and the transport of goods and services
Logistics comprises of endeavor to promote materials and distribution of final production at the right place at the right time and in the right quantity. This service extends from gathering of eaw materials to the delivery to the point of consumption. The logistics service includes warehousing, customer service, communication, packing, handling complaints, and waste management. According to the report, maximum companies nowadays collaborate with business partners to reduce the price of logistics and develop the performance of the business. According to Samsung, they secure custom delivery, quality, technologies, and human resources in such a manner that it maintain a better relationship with the suppliers. As a result, Samsung maximizes synergy, speed, and efficiency to construct a corporate ecosystem that facilitates sustainable growth (Supply Chain | Sustainability | Samsung US, 2020). Samsung is facing problems in gathering the stakeholders to increase their business performance. So, now they are mainly focusing on creating an open and transparent management accountability system so that every stakeholder gathers together. They also request international standards to tolerate human rights management, work environment, and ethics. The improvement of sustainability maintained by Samsung by working with eco partner certified suppliers so that they can access and dominate environmental impact in their components and manufacturing process to reduce pollution in the environment. The problems that face in sustainable logistics are a massive investment in the equipment and higher usage of fossil fuel. The transportation costs become high and, as a result of the prices of the products, also become more senior. This also reduced the rate of customer attraction.
The issues faced by Samsung for the transportation of goods and services as an increment of fuel cost and labor cost affect the prices of the products. Similarly, customers nowadays want more facilities like time delivery and also ask for personalized services in terms of packaging. Samsung is a company that operates globally, so the company needs to be much aware of the rules and regulations of the country as rules can disrupt the whole set of operations. The company may also face huge losses due to laws and regulations.
Differentiate between inbound and outbound sustainable logistics
Analyzing inbound logistics is necessary for every company because it forecast the development phrases of the products. According to Samsung, this company also needs to keep a good relationship with the suppliers as their support is required to receive, store, and distribute the products. Samsung may face some challenges in product improvement phrases. Inbound logistics are needed to be focused by Samsung so that they can keep a pure record of the products from the time of raw materials to final products (Value Chain Analysis Of Samsung Group, 2020). Inbound logistics are recapturing raw materials, storing raw materials, and internally using the elements to start the production process. Samsung has an ancillary to accommodate the complete logistics service. The ‘Samsung electronics Logitech’ maintains the logistics service of Samsung (SAMSUNG CASE STUDY, 2020). Samsung also engages the experts in the inbound logistics services. The committee in the inbound logistics services of Samsung gives an update of the monthly rolling production plan. In Samsung, the imported items are ordered based on the monthly rolling production plan so to avoid high weight and low value. They mainly focus on ait freighted.
Outbound logistics are the activities which include the delivery of the products to the customer after passing various emissary. The outbound logistics actions are warehousing, order processing, transporting, and distribution to the final customer. Samsung needs to provide some more focus on outbound logistics because the performance of the products gets deteriorated due to fast shipment. The adverse effects get on the products when outbound logistics are done timely. It increases customer satisfaction and also increases the growth opportunities of the company. Samsung also needs to pay attention to its outbound value chain action when its offered products required within a short period. Samsung company needs to consider and improve the outbound logistics in value chain activities to achieve competitive advantages and to improve the performance of the business (Supply Chain – SAMSUNG(I), 2020). They attained the attraction of the customer due to the facility of delivering the products within 48 hrs.
Difference between third-party logistics and fourth-party logistics
The fourth party logistics provide a high level of useful services to the customers and allow the manufacturers to outsource their logistical process to their third party experts to process the business efficiently. It is hard for companies to choose among the 3pl and 4pl because they have different advantages and disadvantages. Choosing among these two may make it crucial for the company to maximize the efficiency and cost-effectiveness of supply chain management. According to Samsung, the report says that this company utilizes the service of 4PL. The fourth party logistics support the company to perform its logistics service efficiently. The fourth party logistics includes managing projects, managing inbound, outbound, and reverse logistics. The Samsung SDS service provides the logistics service with high performance (Integrated Logistics | Global 4PL services | Samsung SDS, 2020). The fourth party logistics functions at the improvement and the assimilation level. Samsung owns its assets like trucks and warehouses, so it is not dependent on any other companies for logistics services.
The 3PL service is a service where the manufacturer forecasts the supply chain but outsources the transportation and logistics services to the 3PL provider. The 3PL providers play a role of manager between the manufacturer and the retailer. This service can have control over returns. This service also reduces risks. The business which is more complex to manage the internal management required 3PL services to process the company effectively. The 3PL service is only suitable for small and medium scale businesses as it does not put much focuses on customer services. Samsung may face some challenges if it utilizes the 3PL services. The problems are less control over inventory, and if the orders are low, then it is an expensive service. Samsung operates in more than 40 countries, and every country has the logistics branch. The fourth party logistics service provides a single point of contact. In contrast, the third party takes care of the specific aspects of the business (4PL vs. 3PL: Difference Between Logistics Providers | Easyship Blog, 2020).
Classify the perception of reverse logistics and its application to various industries
Reverse logistics comprises the usage of products by recycling them. It is the process of planning, controlling, implementing, cost-effective flow of raw materials. Reverse logistics reduce the wastage of raw materials. Samsung faced several problems after launching the Galaxy note as many customers revealed that the galaxy note gets exploded after using it for some time. So, the company refurnished the phone and relaunched it in the market. Later on, Samsung revealed that the phone gets exploded due to negative electrode deflection. In reverse logistics, the goods transfer from the customers to the distributors or the manufacturers. Opposite logistics concept used by various industries to achieve sustainable growth of the company. This logistics service mainly proposed by the electronic sector and the massive machines manufacturing sector. According to Samsung, it is an electric manufacturing sector, and it refurnished its products and sold them to the final customers. Reverse logistics service also improves the efficiency of the company and supports the company in earning huge profits. It also helps the company to attain sustainable growth, which reduces pollution from the environment. Samsung focuses on the environment while performing its business. Reverse logistics comes into consideration when a customer receives a defective product. The customer returns the product, and at that time, the company organizes to shipping the product back to the manufacturing unit, the products get checked and then it gets refurnished and get sold in the market. The benefits which Samsung obtains from reverse logistics reduce the cost of production of goods, reduces the level of losses, faster service, and the most practical benefit is customer retention (Sharma, 2020). The customer gets attracted to the company if the company fixes the problem even after making a mistake. The company also earns unplanned profits by implementing reverse logistics in the company.
Appraise the issues and challenges in the implementation and application of reverse logistics
Reverse logistics is a complex process that businesses use. It is deplorable to understand the process of reverse logistics. This service also increases the expenses of retailers. Reverse logistics is maintained by the industry to gain customer demands and to earn more profits. The products which are defected the company gather those products and refurbish them by using advanced software to resell them in the market. Several problems arise due to the implementation of reverse logistics. The problems are:
Tracking value: Samsung faces a problem in the cost structure of the products. In reverse logistics, the value of the products becomes zero due to its defectiveness. The company uses advanced technology to repair the products. The cost of installing advanced technology has a considerable effect on the prices of the products. Similarly, reverse logistics is much more complicated as compared to forward logistics. The company also faces loss due to the defectiveness of the product. The demand of the consumer for those particular products also gets affected.
Customer experience: The Company needs to focus on the products while manufacturing them. A defective product may provide miserable expertise to the customers. The customers may swap from the selected company to some other. In other words, reverse logistics may alienate customers. The company may lose customers if they do not manufacture the products accurately. Similarly, in Samsung, due to galaxy note, this company also lost many customers. The galaxy note was the defective product as it has the problem of getting exploded.
Incompetence to understand the rationale of returns: The Company faces problems when the customers return the products within 30 days of purchase at that time, the company need to refund the full money to the customer. In this case, the company faces a huge loss. The performance of the business gets deteriorated due to this process. According to Samsung, this company also faces problems as many inconveniences occur due to reverse logistics.
Inadequate labor resources to handle returns: The Company does not engage many laborers in the process of accepting defective products. Samsung also incurs a massive loss as they don’t keep the records of the faulty products, and as a result, those products marked as scrap.
Classify the impacts of implementing reverse logistics schemes in the different business sector
Reverse logistics is the most complicated process. It incurs a massive loss due to returning the products. The company that maintains this process faces considerable challenges in its business. According to Samsung, it is an electronic sector, and it faces various problems due to reverse logistics. If a customer returns the product to the company at that time, the company faces a massive loss due to refunding money. The customer service also becomes deteriorated due to reverse logistics. In the electronic sector, the company loses its customer due to defective products which the company by mistake provides to the customer. The unfortunate error by the company affects the production of the company. Sometimes the returned products market as scrap as the companies do not have much time to test and repurpose the. According to the research, it has observed that 85% of electronic products are NFF means they can reuse for service part or even resale (Dias, and Braga Junior, 2016). The companies have two departments who look into the reverse products. One department is handling returned products, and the other is handling spare parts procurement for repair, but these two departments do not maintain any type of formal communication between them. So, the company faces a massive problem in their cost structure. The performance of the company gets disturbed due to this. The brand value of the company also gets concerned.
Evaluate different measures that will reduce the amount of greenhouse gas and waste generated by businesses
Every company needs to identify the waste that their company is producing. The company needs to implement some measures through which the company can obtain competitive advantages sustainably. The companies need to organize a waste reduction program, through which the environment will be clean and bright. The 3R process may support the company to earn more profits and will also increase the efficiency of the company. The method of recycling can cut disposal costs and can improve the bottom line. The identification of waste materials may support the organization to develop the technologies, which may cause less pollution in the environment. According to Samsung, this company works solely with eco-friendly certified suppliers to manage and use the raw materials internally into the products which are sustainable for nature. Waste prevention and recycling offer for reducing greenhouse gas emissions. According to Samsung, the report reveals that from the year 2009-2018 company used the technologies of high efficiency to reduce its assembled greenhouse gas emission by 243.1 million tons. Around 3.55 tons of e-waste also collected between the years 2009-2018 (How Samsung Has Evolved Its Environmental Stewardship - Samsung US Newsroom, 2020). Samsung also used 220000 tons of recycled plastics in its products to reduce greenhouse emissions from the environment. Samsung not only engages its business in managing the impact of the environment but also improves its environmentally friendly business formulation. In 2018 Samsung revealed using 100% of renewable energy in its manufacturing unit in the US, China, and Europe. The company also declared using 63000m of solar and geothermal in Korea. This company also monitors the affected substances in the supply chain with the help of the IT sector. The most significant element which Samsung produced is Samsung galaxy s10e, whose front deco part poised with 37% of bioplastics. Samsung also collects e-waste to reduce pollution in the environment. It collects copper, aluminum, steel, and plastic. It uses plastic for manufacturing the products, gathers end of life products such as home appliances to recycle them. The chargers o0f the smart phones of Samsung made up of 20% of recycled plastics. The washing machines which are made by Samsung uses the trolling plate, which reduces the wash time by 50%. Samsung also provides a power-saving mode to every electronic appliance to minimize the usage of resources. The body of the monitors made up of 30% of recycled plastics. These are the ways through which Samsung reduces greenhouse gas from the environment and helps the situation to become pollution-free.
Appraise the extent to which businesses can apply the concepts of reusing, reducing and recycling
The concept of 3Rs comprises reduce, reuse, and recycle. The idea of lowering reveals decreasing the generation of waste. Reducing the weight of the products saves the environment as it utilizes fewer resources. Similarly, the concept of reuse defines as using the used products by recycling them—the process of reuse strategy used in the bottling company to provide a clear example. In contrast, the concept of recycling comes at the end of the waste management technique for decreasing landfill disposal. This is the only process that has a significant impact on the environment. According to Samsung, this company promised to reduce the environmental impact by developing its innovative products. As a promise, Samsung uses raw materials to design its products, which are eco friendly (Applying Samsung’s Innovative Spirit to Eco-Friendly Product Design, 2020). Samsung also maintains management called circular resource management to control the impact upon the environment by developing its product with some advanced technologies. Samsung is the only company that maximizes its resource efficiency from the time of assembly to the time of prospective disposal to minimize the environmental impact. Samsung also ensured the eco-friendliness of its product for the development stage in the year 2005. Similarly, in the year 2014, the company engaged a proprietary system to involve the ecological merits of every product with a facility of eco-rating. The report reveals that in the year 2016, 86% of Samsung products declared as eco friendly. The company also aimed that within the year 2020, they will make every product 100?o friendly. In the year 2014, Samsung also structured a road map to reduce GHG emissions in both the manufacturing and product use stages. Samsung targeted that within the year 2020, it will cut 250 million tons of greenhouse gases emission. They also generated fluorinated greenhouse gases in their manufacturing unit to make its production unit energy efficiency. Samsung is also engaging some innovative techniques to reduce GHG by reducing the usage of hazardous elements in the manufacturing process. In some cases, Samsung used its dangerous item in its products, such as TBBP-A, BFRs, and phthalates. These elements used in the production of televisions and some other electronic appliances.
In conclusion, the above-discussed assignment provided the information related to the supply chain management of Samsung and how does it implement its strategic ideas in the manufacturing process to reduce GHG emissions from the environment. The information also provided knowledge about what types of logistics services does Samsung uses and what challenges it faces while performing its tasks in the logistics service. The report also discussed the problems faced by Samsung due to reverse logistics.
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