Topic 8: e-Supply Chain Management

Supply Chain Management (SCM) is the process of planning, organising, implementing, and controlling supply chain operations as efficiently as possible. It coordinates all activities from suppliers through to final delivery to customers — covering sourcing, procurement, conversion, and logistics.

Three Core Flows SCM Optimises

• Information Flow — sharing data accurately and timely across all supply chain members
• Product Flow — movement of goods from suppliers to customers
• Cash Flow — payment and financial transactions between parties

SCM includes not just suppliers and buyers but also intermediaries — the supplier's suppliers and the customer's customers. Technology is vital as it manages all information and transaction flows between these parties.

Six Eras of SCM Evolution

• Creation Era — Term coined by Keith Oliver (1982); focus on re-engineering and cost reduction; Japanese management influence
• Integration Era — EDI systems (1960s) → ERP systems (1990s); value added through integration across isolated systems → ERP → vertical integration
• Globalization Era — Supply chains extended beyond national borders; global sourcing for competitive advantage
• Specialization Era I — Companies focused on core competencies; OEMs became brand owners; vendor-managed inventory popularised
• Specialization Era II — Transportation brokerages and warehouse management; ASP → on-demand → SaaS delivery models
• SCM 2.0 — Web 2.0-based; supply-chain collaboration platforms connecting buyers, suppliers, and financial institutions for automated finance transactions

Push vs. Pull Models

Five Core SCM Software Functionalities

• Purchasing — Buying raw materials from suppliers; requires close manufacturer–supplier communication for timely delivery
• Operations — Day-to-day activities including demand forecasting; aligns inventory management and production schedules to manufacture the right quantity
• Logistics — Coordinates warehousing, inventory management, and transportation so products reach customers on time and in the right condition
• Resource Management — Plans and controls labour, raw materials, and technology throughout manufacturing; right resource to the right activity optimises the system
• Information Workflow — Manages how data moves between supply chain members; ensures the right company has the right data at the right time, preventing delays and errors

Industry SCM Software Examples

• SAP Supply Chain Management
• Infor Supply Chain Management
• Blue Yonder
• NetSuite SCM

Founded in 1995, eBay is one of the world's largest online marketplaces with 185 million+ active buyers and 1 billion+ listings across electronics, fashion, home & garden, and automotive.

Value Proposition Detailed Seller Ratings (DSR)

Buyers rate sellers on four criteria: item as described, communication, delivery time, postage & packaging charges. DSR improves conversion rates by encouraging accurate descriptions, better photos, and fair shipping charges.

Risk & Trust Management

Main risk = Fraud. eBay counters this through Trust and Safety Programs — including the eBay Feedback Forum and Top Seller Status — to reassure buyers in a fraud-prone online environment.

Creating a Listing — Key Steps

Daraz is an e-commerce marketplace for South Asia (similar to eBay). Sellers register at sellercenter.daraz.lk and must verify their identity (ID card front & back) and bank details (passbook/statement) before listing products.

Fulfillment by Daraz (FBD)

FBD is a service where Daraz handles all processing, packing, and shipping. Products are stored in the Daraz warehouse; only a shipping fee is charged per order shipped.

Benefits of FBD

• Faster fulfilment → improved customer satisfaction
• Higher conversion rates from higher sales volumes
• No warehouse or extra employee costs for the seller
• Unlimited Order Volume Limit (OVL) — easy business scaling

Daraz Seller Center — Key Functionalities

• Adding and managing products
• Overseeing orders (Pending, Shipped, Delivered, Returned)
• Handling stock and inventory
• Joining promotional campaigns & using Ad Solutions
• Accessing Daraz University for seller training
• Contacting the seller support team