IKEA AND UK DISTRIBUTION Essay Example | Topics and Well Written Essays - 2500 words

IKEA AND UK DISTRIBUTION - Essay Example It is argued that the supply chain standards are not fixed at a uniform level or universal conditions cannot be established. Several factors should be taken into consideration while implementing a supply chain implementation or improvement plan. Factors contributing to the effective development of supply chain management are many and varied, which include: The main source of competitive advantage in services industry is efficient service for the customers. Supply chain plays an important role in the efficient service provision to the customers. "The goal of a supply chain should be to maximise overall supply chain profitability. Supply chain profitability is the difference between the revenue generated from the customer and the total cost incurred across all stages of the supply chain. Supply chain decisions have a large impact on the success or failure of each firm because they significantly influence both the revenue generated as well as the cost incurred. Successful supply chains manage flows of product, information, and funds to provide a high level of product availability to the customer while keeping costs low." (Chopra & Meindl, 2004; 44) The IKEA should undertake the approach of goods flow on supply chain according to their shelf life and not just on the time they've been in the supply chain. "For instance, products with long lead-times that have been exposed to high temperatures during distribution would be sent to the retail shelves before those with short lead-times but distributed under more favourable conditions". (Roberti, 2005) The international sourcing policy effects the corporate, marketing, purchasing, and other strategies. It is important for the Management of IKEA to connect the future objectives with corporate objectives and strategy. IKEA and UK distribution: IKEA is a worldwide name with some 175 stores worldwide in locations as far apart as Singapore and the Czech Republic. It works with approximately 1800 suppliers and 55 countries, and its range is made up of around 10,000 products. Swedish furniture retailing giant IKEA's massive newly opened Peterborough distribution center is fast becoming a familiar landmark on the city's outskirts. With over 57,000 square meters of storage space, and boasting an underground geothermal heating system, the 21.3 million warehouse will employ some 250 people by the summer -- all newly created jobs. It will help the company service its 11 existing British stores, which occupy over 26,000 square meters apiece. 20 more outlets should be opened by 2010, leading to a