PURCHASING AND SUPPLY CHAIN MANAGEMENT

Relationship between Purchasing and Supply Chain Management



Executive Summary

Supply Chain Management (SCM) is concerned with transformation demand information to physical deliveries of goods and services. SCM starts with customers' needs for goods and services that create demand for goods and services backwards in the supply chain and supply network. The management ideal is to provide a differentiated management of intra- and inter-organizational activities and processes with the purpose to fulfill customer requirements by delivering goods and services from the point of origin to the point of consumption to the overall lowest costs at the right time and at the highest quality level. The below paper examines the supply chain of one of the famous retail store chain Tesco.

Relationship between Purchasing and Supply Chain Management

Introduction

Tesco is the largest food retailers in the UK, an estimated 15.5% share of the aggregate market. Tesco is also designed to increase their share of non-market. The two most important factors for the success of Tesco in listening are to customers and learning from mistakes. Offering quality products at low prices and put local people first in the way they conduct their business as their primary strategy. (Dixon, 2001, pp. 130) Tesco was based in 1919 and commenced its first shop in Edgware, London, UK in 1929 (Tesco, 2010, pp. 45-55); although, over the decades it has developed to become the market leader in the UK food retail segment (Datamonitor, 2010, pp. 74-85). The relative positioning of Tesco's market share with esteem to other premier players in the market has showed as pursues.

The British supermarket company Tesco is now the fourth largest retail chain in the world employ 450 000 people and has a growth rate of 13% annually. However, things were not always smooth sailing for the leading retail in 1992 was forced to shift its strategy, focusing squarely on the shopper. It all began in 1919 when Jack Cohen founded the first store in London Tesco, dedicated to the sale of surplus production (Adams, Peter, William, Harrison, 1998; Huff, Reger, 1987; Bathory, Alexander, 1987, 130-134). Ten years later, opened its doors the first branch. In 1961, the establishment in Leicester Tesco made its official entry into the Guinness Book of Records as the largest retailer in Europe dedicated to the final consumer. However, in the early 90's changed the outlook for Tesco. He was in a highly developed industry and saturated, in a country with a declining population, under the eaves of a strong leader, and Sainsbury, and threatened by the strong arrival of Wall mart and new store formats with attractive discounts (Ginter, Swayne, Duncan, 2002). Despite this frightening scenario, in recent years Tesco has never stopped growing.

Purchasing department is an integral part of the organization. Different functions within the department of purchasing play their indispensable part in the smooth and effective functioning of the organization. This paper revolves around the phenomenon of purchasing. This paper describes the role of the purchasing department as the separate and ...