Supplier, Value, and Supply Chain
Entrepreneurship
Senior High School Applied - Academic
Where do businesses get
their materials for the
production of their
products?
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● Identify possible suppliers of
Learning raw materials for the proposed
Objectives product.
● Create and manage the supply
At the end of the
lesson, you should be
and value chain for the
able to do the proposed business.
following:
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1. What are the needed materials in order to
produce your selected product?
2. What are the entities involved in order for
you to receive and consume the product?
3. Where do you think manufacturers
produce and store their products?
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Raw Materials
the unprocessed
materials used in the
primary production
or manufacturing of
goods
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How to identify a potential
supplier who will provide raw
materials for your business?
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Supplier Selection Process
1. Thinking strategically in selecting suppliers
2. Setting criteria for choosing a supplier
3. Identifying potential suppliers
4. Drawing up a shortlist of suppliers
5. Choosing a supplier
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Supply Chain
A supply chain is a connected network of
individuals, organizations, and activities that
produces and distributes a specific product to
the final consumer.
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Supply Chain Management
Supply chain management refers to the
management of the flow of goods and services,
including all processes in transforming raw
materials into finished products.
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How do supply chain managers
focus on business processes?
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Supply Chain Management Process
Customer relationship management
Customer relationship management is an
approach in handling business interaction with
current and potential customers.
This process provides a structure for
maintaining and developing relationships with
customers.
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Supply Chain Management Process
Customer service management
Customer service management represents the
business to the customer. It provides a system
of responding to customer complaints,
concerns, questions, and comments.
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Supply Chain Management Process
Demand management
Demand management is a process used to
forecast, plan, and manage the demand for
products and services.
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Supply Chain Management Process
Order fulfillment
This process involves generating, filling,
delivering, and providing service for customer’s
orders.
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Supply Chain Management Process
Manufacturing flow management
Manufacturing flow management includes all
activities needed to obtain, implement, and
manage manufacturing flexibility in the supply
chain.
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Supply Chain Management Process
Supplier relationship management
Supplier relationship management provides
support for developing and maintaining good
relationships with highly valued suppliers in
order to gain performance advantages.
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Supply Chain Management Process
Product development and
commercialization
This process provides the structure for working
with customers and suppliers to develop
products and offer them to the market.
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Supply Chain Management Process
Returns management
Returns management is a process that enables
the business firm to manage volumes of
returned products efficiently while minimizing
the costs.
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Tip
The producers, vendors,
warehouses, transportation
companies, distribution centers,
and retailers are the entities in
the supply chain.
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Example: Supply Chain
Situationer:
An international retail business that operates a
chain of hypermarkets, department stores, and
grocery stores succeeds by having fewer
entities in the supply chain.
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Example: Supply Chain
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How to plan and execute the
transportation and storage of
your products?
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Logistics Components of Supply Chain
1. Sourcing and procurement
2. Production planning and scheduling
3. Order processing
4. Inventory control
5. Storage and materials handling
6. Transportation
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Value Chain
A value chain is a step-by-step activity needed
to create a product or a service.
A business conducts value chain analysis by
evaluating the detailed procedures involved in
each step.
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Michael Porter’s Value Chain
It is a general-purpose value chain that a
business may use to examine all the activities
involved in creating value for its customers.
The value chain activities are performed to
determine the cost and effect of the activities
on profits of the business.
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Elements in Porter’s Value Chain
Primary Activities
1. Inbound logistics
2. Operations
3. Outbound logistics
4. Marketing and sales
5. Service
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Elements in Porter’s Value Chain
Support Activities
1. Procurement
2. Human resource management
3. Technological development
4. Infrastructure
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Remember
Porter’s value chain is a useful
strategic management tool.
It works by breaking down relevant
pieces to see the full cost drivers
and the sources of differentiation
of the business.
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Activity
Look for suppliers and their profiles for the
following raw materials:
1. Flour
2. Milk
3. Sugar
4. Rice
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Questions
Part A. Explain your understanding of the
following concepts:
1. Raw materials
2. Supply chain
3. Logistics
4. Value chain
5. Customer
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Questions
Part B.
Form a group consisting of the same
members in the business plan. Analyze the
needed raw materials for your proposed
product. Search and identify possible
suppliers for raw materials.
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Wrap Up
A raw material refers to the unprocessed
material used in the primary production or
manufacturing of goods.
A supply chain is a connected network of
individuals, organizations, and activities that
produces and distributes a specific product to
the final consumer.
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Wrap Up
A value chain is a step-by-step activity needed to
create a product or a service.
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Wrap Up
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Bibliography
Drucker, Peter. Innovation and Entrepreneurship: Practice and Principles. New York: Harper & Row, 1985.
“Porter’s Value Chain: Understanding how value is created within the organizations.” Mind Tools. Accessed
April 26, 2020. https://www.mindtools.com/pages/article/newSTR_66.htm.
Rouse, Margaret. “Logistics” Tech Target Network. Accessed April 25, 2020.
https://searcherp.techtarget.com/definition/logistics.
“Supplier selection process.” Info Entrepreneurs. Accessed April 24, 2020.
https://www.infoentrepreneurs.org/en/guides/supplier-selection-process/.
“Supply Chain Management 101: Principles, examples, and templates.” Smartsheet. Accessed April 26,
2020. https://www.smartsheet.com/supply-chain-management.
Tardi, Carla. “Value Chain” Investopedia. Accessed April 26, 2020.
https://www.investopedia.com/terms/v/valuechain.asp.
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