Types of Organizations
A supply chain describes a chain of entities that are involved in manufacturing, distributing, and delivering a specific item or service to an organization. The various entities involved are manufacturers, distributors, warehouses, logistics companies, and retail stores.
There are different types of organizations that participate in this process. For example, in manufacturing, there are factories that make products and then distribute them to different sites. Similarly, distribution involves the various trucks used in transporting products.
Organizations within the manufacturing chain include factories, manufacturers, distributors, and customers. All these entities share common goals, such as reducing cost and increasing profit. As part of the process, all of these organizations share some type of responsibility. For example, factory owners may be held responsible for ensuring that the right quality standards are met. Manufacturer’s responsibility is to ensure that the products being manufactured to meet the required specifications.
Another type of organization within the supply chain is the retailer. Retail stores usually provide their customers with the products or services they order. Retail store owners are responsible for providing the appropriate inventory, customer service, and sales strategies for their customers. Retail store owners may also hold an advisory role, helping their manufacturers-partnership’s-establish the proper distribution strategy. Retail store owners can either directly engage into the supply chains, such as by buying stocks of goods from the manufacturers, or indirectly through the use of logistics companies or other suppliers.
As mentioned earlier, the third type of organization within the supply chains of India is the middlemen. Middlemen typically work with the companies or manufacturers to bring down their cost of production. However, their role does not end there. Middlemen act as mediators and facilitators, so that the companies’ interests can be properly represented in the supply chains. Some middlemen work on commission; however, other middlemen work on contract basis, in return for which the companies can get their profit back. This makes the process highly flexible.
The four types of organizations mentioned above represent the basic concept of the supply chains in India. These organizations, as the name indicates, have different functions within the supply chains. Each type has its own unique functions and benefits, depending on the nature of the organization involved. The type of organization that plays a major role in a particular organization varies according to the nature of the business. It is therefore important for every organization to understand the role of the other organizations involved.