Discuss about the Logistics and Supply Chain Management for IKEA.
The report helps in analysis of the different kind of supply chain management programs of IKEA organization. The proper analysis of the entire enterprise is essential to be done in order to implement the supply chain management strategies along with analysis of the effectiveness of the supply chain management programmer as well.
The main aim and purpose of the report is to identify the different kind of aspects of the supply chain management programme in an effectual manner. The different characteristics of the supply chain management is required to be analysed with proper collaboration with the different partners and customers of IKEA as well.
The structure of the report includes the analysis of the different kind of supply chain management of the organization named IKEA. The analysis of the market is required to be done in order to understand the different techniques that is essential in nature for obtaining sustainable supply chain management.
IKEA is one of the largest Swedish Dutch Multinational group of companies that helps in selling along with designing different kind of readymade kind of furniture along with assembling the appliances along with furniture in a successful manner as well. The respective company was founded in the year 1943 and the headquarters of the respective company is based in Leiden, Netherlands (IKEA, 2018). The respective company IKEA serves in the entire world and they have earned revenues of more than €35.074 billion till the year 2017. The number of employees who are presently employed in the respective organization is more than 194,000 all over the world and the company is performing well in comparison of the different kind of competitors in the market as well.
The respective company is the retailer of the furniture and it has been awarded the best award for selling the eco friendly kind of furniture and appliances in an effectual manner as well. Furthermore, it has been seen that IKEA has been able to reduce the strategy of pricing in the last few years to more than 3% as they wanted to implement continuous development program in producing, designing and selling different kind of goods and services to the customers effectually. Presently, the organization is operating in more than fifty countries wherein there are more than 450 stores all over the world in an effectual manner.
IKEA is one the largest ready to assemble furniture company along with different kind of furniture appliances along with different kind of home accessories. Furthermore, it has been seen that the respective company has displayed more than 20000 products that has helped the company in showcasing their products to the customers and they gain competitive advantage in the entire market as well (Beske and Seuring 2014).
The major operations of IKEA are development of the different kind of readymade products that are sold by them to the customers and this is one of the competitive advantage of the company as well. IKEA is known for selling the different kind of lifestyle furniture to the different customers in the market and disassembled furniture as well. Furthermore, more than 70% of the annual marketing budget is consumed by the catalogue of IKEA and this helps them in attracting more customers as well (Mangan, Lalwani and Lalwani, 2016).
Supply Chain Management is defined as the essential processes that helps in management of the flow of the different kind of goods as well as services. Proper analysis is required in the process of the supply chain management of IKEA as this helps in identification of the pros and cons of the products and services that is delivered by IKEA (Khalid et al. 2015). Furthermore, it has been seen that the supply chain management of IKEA includes three different sectors that includes primary, secondary along with tertiary sector as well.
The primary sector includes the proper extraction or the entire development of the different kind of natural resources that includes timber along with minerals or oils. The different kind of raw materials that are required in the production of the goods required to prepare the furniture and other appliances are included in the primary sector (Chin, Tat and Sulaiman 2015).
On the other hand, the manufacturing of the different kind of goods and services that are required in the preparation of the furniture in the respective company. The secondary sector includes the usage of the extracted primary materials that is assisted in building along with developing finished products. Lastly, the tertiary sector includes providing different kind of services in meeting the different demands of the end users (Monczka et al. 2015). . The tertiary sector includes the distribution, retailing along with providing relevant kind of customer services as well.
From the diagram, it can be seen that the primary sector includes the development of the raw materials wherein the respective company IKEA designs the products in Sweden and it is seen that the low price is main factors wherein IKEA considers while producing different kind of home furnishings. The respective company negotiates prices with the different suppliers along with checking the quality of the materials with the different kind of environmental impacts on the same as well.
Secondly, the different manufacturers within the entire secondary sector includes the products of IKEA that has been made from the raw materials from the primary sector. It has been seen that IKEA designs different kind of products and services wherein this will help the company in making optimum utilisation of the different resources and make the best possible products and satisfy the customers as well (Schorsch, Wallenburg and Wieland 2017).
Lastly, the tertiary sector of IKEA’s retail stores helps in adding value to the manufactured goods and services that is produced by the customers effectually. The meets of the customers are met by IKEA in an appropriate manner wherein it is seen that IKEA store is large in nature and it holds more than 9500 products that is providing the customers with lot of choices as well (Simpson et al. 2015).
There are different kind of characteristics of the SCM of IKEA that includes the following:
There are different kind of activities that are performed by IKEA in making the supply chain management sustainable in nature at IKEA. It has been seen that IKEA uses the tool named e-wheel as this helped in evaluating the impact on the different products. Proper ascertainment has been done wherein the sustainability in the products has assisted IKEA in improving the understanding of the environmental impact of the products that are supplied by them. It tried to increase the cash flow of the various goods and services by improving the bottom line and providing efficient manufacturing strategy as well (Fernie and Sparks 2014).
Furthermore, proper ascertainment has been done wherein it is seen that IKEA uses different products for production of goods and services that can be recycled and it helps in minimising the usage of the materials as well. IKEA has tried to create different kind of designs solutions as this helped in minimising the use of the materials in an effectual manner. The strategies include some tables produced by IKEA is made of recycled kind of plastic and this is lowering the cost of the travelling as well (Carter, Rogers and Choi 2015).
The collaboration with the different suppliers and logistics partners are done by IKEA as this has assisted the company in providing them with different products and services effectually. The supply chain management of IKEA has helped in maintaining better trust between the different partners and solved the issues effectively.
Conclusion
Therefore, it can be concluded that supply chain management of IKEA plays a significant role in managing the trust between the different partners and employees. Furthermore, it has been seen that it reduced the cost of inventory along with providing efficient kind of process integration in an effective manner as well.
Therefore, it can be recommended that IKEA needs to maintain proper kind of relationship with the different suppliers in the organization. The proper sustainability is required in the organization as this will help them in managing the issues and solve them effectually as well.
References
Beske, P. and Seuring, S., 2014. Putting sustainability into supply chain management. Supply Chain Management: an international journal, 19(3), pp.322-331.
Brandenburg, M., Govindan, K., Sarkis, J. and Seuring, S., 2014. Quantitative models for sustainable supply chain management: Developments and directions. European Journal of Operational Research, 233(2), pp.299-312.
Carter, C.R., Rogers, D.S. and Choi, T.Y., 2015. Toward the theory of the supply chain. Journal of Supply Chain Management, 51(2), pp.89-97.
Chin, T.A., Tat, H.H. and Sulaiman, Z., 2015. Green supply chain management, environmental collaboration and sustainability performance. Procedia CIRP, 26, pp.695-699.
Fernie, J. and Sparks, L., 2014. Logistics and retail management: emerging issues and new challenges in the retail supply chain. Kogan page publishers.
IKEA. (2018). IKEA.com – International homepage. [online] Available at: https://www.ikea.com/ [Accessed 28 Apr. 2018].
Khalid, R.U., Seuring, S., Beske, P., Land, A., Yawar, S.A. and Wagner, R., 2015. Putting sustainable supply chain management into base of the pyramid research. Supply Chain Management: An International Journal, 20(6), pp.681-696.
Mangan, J., Lalwani, C. and Lalwani, C.L., 2016. Global logistics and supply chain management. John Wiley & Sons.
Monczka, R.M., Handfield, R.B., Giunipero, L.C. and Patterson, J.L., 2015. Purchasing and supply chain management. Cengage Learning.
Schorsch, T., Wallenburg, C.M. and Wieland, A., 2017. The human factor in SCM: Introducing a meta-theory of behavioral supply chain management. International Journal of Physical Distribution & Logistics Management, 47(4), pp.238-262.
Simpson, D., Meredith, J., Boyer, K., Dilts, D., Ellram, L.M. and Leong, G.K., 2015. Professional, research, and publishing trends in operations and supply chain management. Journal of Supply Chain Management, 51(3), pp.87-100.
Stadtler, H., 2015. Supply chain management: An overview. In Supply chain management and advanced planning (pp. 3-28). Springer, Berlin, Heidelberg.
Essay Writing Service Features
Our Experience
No matter how complex your assignment is, we can find the right professional for your specific task. Contact Essay is an essay writing company that hires only the smartest minds to help you with your projects. Our expertise allows us to provide students with high-quality academic writing, editing & proofreading services.
Free Features
Free revision policy
$10Free bibliography & reference
$8Free title page
$8Free formatting
$8How Our Essay Writing Service Works
First, you will need to complete an order form. It's not difficult but, in case there is anything you find not to be clear, you may always call us so that we can guide you through it. On the order form, you will need to include some basic information concerning your order: subject, topic, number of pages, etc. We also encourage our clients to upload any relevant information or sources that will help.
Complete the order form
Once we have all the information and instructions that we need, we select the most suitable writer for your assignment. While everything seems to be clear, the writer, who has complete knowledge of the subject, may need clarification from you. It is at that point that you would receive a call or email from us.
Writer’s assignment
As soon as the writer has finished, it will be delivered both to the website and to your email address so that you will not miss it. If your deadline is close at hand, we will place a call to you to make sure that you receive the paper on time.
Completing the order and download