SCM, short for Supply Chain Management, is the coordination of all the flows — physical, informational and financial — that connect suppliers, production, storage, transport and distribution through to the end customer. Its goal is to deliver the right product, to the right place, at the right time and at the best cost, while keeping inventory levels and customer service quality under control.
The supply chain spans many interdependent processes: demand forecasting, procurement and supplier relationships, production planning through MRP, warehouse management, order picking and transport logistics. Managing it relies on indicators such as service level, inventory turnover or lead time, and on analysis methods like ABC analysis, which ranks items by their economic weight in order to focus effort on the most strategic ones.
When managing perishable stock, rotation rules such as FEFO (first expired, first out) ensure that batches with the nearest expiry date are used first, in order to limit losses. Optimizing purchase quantities, meanwhile, often relies on the economic order quantity (EOQ), which seeks the balance point between ordering costs and holding costs.
eyeot's Supply Chain solution covers these procurement and logistics planning dimensions within the ERP.