TARGET SUPPLY CHAIN
Target’s supply chain has faced challenges as the organization has expanded its distribution line to other new products and streams. On the expansion of their grocery business that included perishables such as meat, fresh produce, dairy products, the process of supplying became a challenge. The situation of supply chain was made worse by the online customers being allowed to come in to any store and take up their orders. This has caused the supply chain management in Target to be in kind of a spaghetti mix but the organization is planning for a streamlining of this important process of the organization (Solomon, Marshall, & Stuart, 2018). The supply chain of this organization that enjoys a good reputation has been marred by challenges mainly that has been caused by their expansion of their operations.
How to include the suppliers in making their decision on how to be effective while improving the supply chain system pipeline (Solomon, Marshall, & Stuart, 2018). Discuss the type of distribution strategy that Target most often practices. What does this type of distribution strategy entail and why is it an effective strategy for Target? The most used distribution strategy that is used by Target is the Intensive distribution strategy. This entails the selling of products in bulk and displayed in different ways to give much exposure to the customer. The main reason why this is used is because most of the products that are sold in Target’s stores are Fast-Moving consumer goods. The losses that are experienced because of the Stock-outs are usually referred to as Stock-out costs.
Technology has been in the forefront of reducing the probability of stock-outs occurring in the retailers’ premises. The Radio frequency identification (RFID) technology has been of much help in this sect to give a better coordination between the supplier and the retailer to reduce the average stock-out. The main reason that has been cited as a cause of inefficiency and delays that cause stock-outs by suppliers is the cause of a retailer. The replenishment of the retailer is the main cause of the delays and not really the disbursement of the suppliers downstream to the retailers. This has been led by Mulligan Aegis. Mulligan has for example used the case of peanut butter that has 24 jars but the shelves can only take in 18.
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