An Introduction To The Links In Supply Chain

The experienced businessman dealing in international trade is well aware of the importance of the supply chain. The name alone clues the novice entrepreneur to its meaning - each "link" represents an essential business or representative that relies on the other links to keep trade, sales, and supplies strong. When a link goes missing or breaks (i.e. is unable to perform to capacity and satisfy the needs of others), all connected to the chain suffer.

To better understand dealing in international business, assuming you have set up profiles on a global trade forum or similar networks, it's necessary to know exactly who are the links in the chain you'll build yourself. It may surprise you to know, too, that you are not always an anchor or end. How you conduct business and what you expect to do depends on your position, but know this: one link doesn't out rank the other. All have their own duties to attend, and that is what helps to strengthen global economies and relations.

The Supply Chain: The Major Players

Browse any supply chain forum and you are likely to find a number of "links," including:

The Supplier of Raw Materials: Companies that supply raw ore, iron, timber, coal, and other natural resources used in the production of goods. Certain food growers may qualify here as well, if the foodstuff is used to produce different things (i.e. milk for dairy products).

The Manufacturer: Companies that process materials to create goods, everything from cars to clothing to TV dinners. Many of these business may rely upon different raw materials to achieve their goals, thus splitting adding tangent links to their part of the chain.

Warehousing and Inventory: Finished goods and stored and kept before they are sold and shipped around the world. Manufacturers may handle their own warehousing or arrange with a third party to take care of things.

Vendors: Whether wholesale or retail, vendors are important in that they are the ones who will take the products and sell them to customers - large department stores, e-commerce gateways, or smaller retailers may fall into this category.

Consumers: Yes, consumers are considered part of the chain, as the money they spend on items figures into international trade. The more people buy of one particular product, the more likely vendors will order more, and manufacturers will create.

In between these major links, you may find others involved in the process of bringing goods to the public. Supplemental sales forces, quality control, and other jobs figure into the plan as well. However, without the top players that provide resources, refine them and sell them, your link to financial success with your business is threatened. Research carefully which companies you add to your chain.