What is a global supply chain? How to adapt to new trends

Global supply chain is a concept that is increasingly interested in the current era when international trade tends to develop strongly. If readers also want to learn about this concept, let's see the content of Viindoo in the article below.

>>>> See More: SCM Software

1. What is a global supply chain?

Global supply chain la system that spans the whole world. Supply chains allow a business to buy and use a good or service from other countries and perform the supply and distribution of a certain product.

The current global supply chain offers many opportunities for any business wishing to participate in the international business environment. A sustainable supply chain system will create favorable conditions for import and export activities to take place more smoothly and easily.

>>>> Read More: What is a supply chain? Components in the supply chain

2. How is the global supply chain different from the domestic supply chain?

There are many differences between domestic and global supply chains as follows:

• Global supply chain

This supply chain uses low-cost national sourcing. It is the procurement of products and services from countries where labor and production costs are lower than in the country in which the business is located. This supply chain will typically originate from a business in the developed country as a buyer and supplier located in other regions of the world.

• Domestic supply chain

The domestic supply chain will seek to optimize regional suppliers. In some cases, businesses will seek to take advantage of domestic supply routes. This means that all of your supply chain suppliers will be located in the country where the organization is located. Suppliers can even be located in the same city or region as the business and provide quicker access to raw materials.

3. Benefits of the global supply chain

Supply chain development trends globalization brings businesses many benefits as follows:

• Cost savings: This supply chain allows businesses to outsource human resources, buy cheap materials from other countries. This will help businesses save production costs, increase competitiveness in the market.
• Opportunity to hold more inventory: Businesses have access to more cheaper supplies at lower costs. Along with that, by owning more branches around the world, businesses can have more space to store goods.
• Access to many potential partners: Globalization gives businesses the opportunity to access more quality partners around the world. With that, global supply chain help Businesses have more options. As a result, suppliers will also try to increase their advantages, providing businesses with better quality products.
• Faster transit time: Thanks to this supply chain, components and materials reach businesses faster, and the production process becomes more optimized.

4. New shifting trends of the global supply chain

The Covid 19 pandemic took place, causing serious disruptions global supply chain. Many businesses around the world are severely affected by the pandemic. However, many business owners are also trying to adapt and find a way to connect the supply chain and restore production and business in the following three main directions:

• The first is to move supply chains in countries in the same geographical area to reduce the impact of political conflicts, trade wars or conflicts between economies. Simple steps in the production and business process such as outsourcing, assembly, etc. are moved abroad to optimize costs and spread risks.
• The second is the trend of shifting global supply chains that require investment. This shift is often accompanied by production activities that require a high level of science and technology, products related to core advantages of enterprises or state secrets.
• Third, restructure the supply chain, diversify supply worldwide to reduce and supply chain risk management. 
  
  To adapt to this shift, countries need to prepare a stable political and macroeconomic environment. Along with that, infrastructure and high-quality human resources are essential to receive the investment of large corporations around the world.

5. How to adapt to new changing trends in the global supply chain

The trend of globalization is gradually spreading, global supply chain There are also many changes. To adapt to this, suppliers need to use technology applications, creating an environment of direct interaction between manufacturers and consumers. It also becomes easier to exchange goods, services or currency.

This proves that digital technology and e-commerce will be the key solutions to adapt to the changing supply chain and complex changing business environment. The application of digital technology and e-commerce will be the development trend of the supply chain in the future.

Viindoo supply chain management software is an effective solution to help businesses adapt better in the digital age. This software helps businesses solve difficult problems of business process optimization and inventory management. Product distribution services to consumers are also enhanced.

In the above post, Vindoo have compiled specific and detailed information about global supply chain. Hopefully, the article will help you have a more comprehensive view of the supply chain and find solutions to deal with the shift in the current digital age.

>>>> Continue With:

• Information flow in supply chains before the Big Data era
• Lean supply chain: The inevitable sustainable trend