The paper "Supply Chain Strategy - Crowning Glory Ltd " is a good example of a marketing case study. Supply chain strategy defines the operation of the supply chain of an organization in terms of its competitiveness. It is an iterative process by which to evaluate the cost-benefit trade-offs associated with operational components of the organization. Basically, a supply chain strategy involves the actual operations undertaken in the organization as well as the overall supply chain that helps to meet a related objective (UPS 2005). This report aims to provide suggestions about the appropriate supply chain strategy that the company board of directors at Crowning Glory Ltd can follow to continue enjoying the dominant share of the market.
A critical analysis will be made about the options taken by the management to assess their value in regard to the company’ s new strategic direction to diversify their business to supply their hair care products to the retail market An effective supply chain strategy is one that operationalizes and supports the business strategy, and thus the power of alignment must be considered when developing frameworks for supply chain competences.
Basically, the products expected to meet the needs of identified market sectors are specified in the business strategy. This implies that the supply chain strategy has to be aligned with the strategy for developing products as well as sales and marketing strategy. From the dynamic framework point of view, a business must be aligned with its markets or customers. Therefore, it is important to first understand the needs of customers prior to segmenting them into various groups because different people have different buying values (Hau 2002).
Since there is a great opportunity for Crowning Glory to ship its shampoo products in large quantities to their retailers’ regional distribution locations, it would be a cost-saving approach for the company to integrate bottle production with their filling line to supply shampoo directly to retailers in their own made bottles. The major reason for having a supply chain strategy is to define how a company works with its supply chain partners who comprise of customers, distributors and suppliers (Liker & Choi 2004). The fact that marketplaces have become increasingly competitive, it would be relevant for the board of directors at Crowning Glory Company to reinforce the existing relationships with Deerfield packaging, its current supplier of shampoo bottles rather than to take the step of only re-sourcing the bottles, saying thank you and goodbye to Deerfield.
This is because Crowning Glory Company has a sense of loyalty to Deerfield their present and only available supplier of shampoo bottles. By requesting the retailer to assist in managing part of their supply chain, the management of Crowning Glory would be able to expand their production and sales without necessarily spending money on marketing and developing a distribution system because the retailers will act as an intermediary distributor of shampoo products.
Through the retail trade, therefore, the Crowning Glory Company will establish more opportunities to launch its brand and possibly to take contracts with other retailers that have big market shares for own-brand products. In order to develop an effective supply chain strategy, it is crucial for management to understand the business strategy put in place to determine how the organization decides to compete based on its core competencies, business focus and the means of differentiation.
However, management should consider assessing the entire supply chain prior to developing an ideal implementation plan. A number of companies develop their supply chain strategies after defining the business strategy (UPS 2005). Following enquiries from major national multiple stores that facilitated the supply of samples and trial of a Crowning Glory shampoo in the store’ s customers, it is apparent that users like the company’ s shampoo product more than the competing products. In addition, Crowning Glory is well-positioned to become a regular supplier where it is expected that its products will be shipped in large quantities to the regional distribution centres of the retailers, branded as their own product.
Therefore, it is necessary to point out that the management of Crowning Glory should go ahead with the idea to invest in moulding machinery, acquire appropriate expertise that can enable the company to become a bottle maker and major producer of shampoo product.
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