Manufacturing Strategies Used in Supply Chain

Make To Stock (MTS)

According to the market demand, customers expect to find goods at the market all the times when they need them. In this case, manufacturers must ensure goods are available at the retailers shelves within the customers reach. For this reason, they produce goods that are going to meet the customer needs at all the time. Therefore, manufacturers produce goods to stock at the warehouse ensuring they meet the market demand. However, they must be careful to ensure that there are no stock outs and at the same time, they must ensure that there are no wastages (Beaumont 2009). This strategy of manufacturing to stock is referred as make to stock.

The advantages of this strategy are that it is cost effective. This is because it serve the needs of customers and saves manufacturers the trouble of failing to fulfill the customers need. On the other hand, this strategy has disadvantages affecting it. According to market demand, fluctuations are constant making it impossible for manufacturers to establish the amount of stock to produce for purposes of meeting the market demands. In some cases, they might make fewer products assuming the demand would be less. Instead, demands rises causing stock outs. This will cause the company to lose many customers. On the other hand, they might make many goods in anticipation of a high demand. Instead, the demand goes down leading to massive losses (Beaumont 2009).

Make To Plan (MTP)

There are many times when a customer offers to wait while his or her products ordered pass all the manufacturing processes. For instance, when a customer wants a house, the customer may wait until the house is built. However, there are certain instances where customers are impatient and they cannot wait for their goods to pass through all the manufacturing processes. Therefore, manufacturers have to find ways to buy time for the purposes fulfilling customer needs. In this case, they may decide to hold stocks on the shelves for the customers (Beaumont 2009). This strategy of holding stocks for the customers is referred to as make to plan manufacturing strategy.

Assemble To Order (ATO)

This is where manufacturers make all the necessary parts required to complete a certain product. However, they do not assemble the parts until the customer has confirmed the order. In this case, manufacturers have the advantage of producing parts according to market demand of the product. This ensures they do not have stock outs or redundant stocks. Additionally, it ensures that they do not assemble products leading to wastage due to lack of customers. It can be noted that assemble to order is a mixture of make to order and make to stock (Beaumont 2009). The parts are produced based on make to stock while assembling of the parts is made based on make to order.

Engineer To Order (ETO)

Products come in different varieties based on customer specifications. For this reason, companies tend to produce what the customers want. According to unspoken laws of business, the customer is always the king. However, certain products or goods are produced in accordance to the customer specifications. Additionally, these goods may not be needed by other customers. This is because only one customer wants them. An excellent example of these products is the different computer packages. Therefore, manufacturers do not produce them until the customer confirms the order. Moreover, manufacturers cannot make more than one in anticipation of demand since there are no other customers who will buy the product (Beaumont 2009). This strategy employed by the manufacturer is referred to as engineer to order.

Strategies employed by dominant supplies to retain dominance in the market

The first strategy employed by dominant suppliers is creation of a variety of products. This is where a supplier produces many products to meet the different customer needs. For instance, a dominant supplier producing computers may produce laptops, desktops, ipods and bookmarks to suit customer needs. In this case, the supplier is able to tap the market of those customers who need laptops and at the same time, tapping those customers who would like to buy desktop computers (Sadler & Gough 2005). Therefore, production of a variety of goods strategy ensures dominant suppliers retain dominance in the market.

Innovation is another strategy used by dominant suppliers to stay in the market for a long time in the industry. Currently, the market is constantly changing due to different customer demands. Additionally, technology has come to revolutionize the globe creating new market trends. For this reason, dominant suppliers always try to be on top of the current market trends. To make sure they are up to date with the current technology, they must be innovative when coming up with new products as the market demands them. When they do this, they will always be the dominant suppliers in the market. Therefore, innovation is a strategy employed by dominant suppliers to ensure dominance in the market (Pride, Hughes & Kapoor 2011).

Finally, consistence and attractiveness are the other strategies used by dominant suppliers to ensure their dominance in the market. When suppliers are producing their goods, they must ensure quality of the goods is consistence. This is because customer buy goods based on traits such as quality. In this case, if a customer buys a product today and the product is of high quality then tomorrow he or she buys a similar of low quality, they will cease from buying the product. Second, customers buy a product appealing to the eyes. No customer will buy a product that is ugly and does not appeal to the people. Therefore, dominant suppliers are always consistence and they produce attractive goods.

Strategies employed by dominant supplies to benefit supply chain

Dominant suppliers tend to ensure that the supply chain is extremely effective thus benefiting it. An effective supply chain is cost effective and leads to quality production of the goods. For this reason, dominant suppliers employ strategies that will ensure efficiency of the supply chain. First, they use just in time strategies. This strategy ensures that everything is perfectly in place where it is supposed to be in the market. For instance, the manufacturers ensure that goods are in the market at the right time and at the right time. This enhances efficiency in the market leading an efficient supply chain.

The use of technology is one of the most effective strategies that will benefit supply chain. According to technology, efficiency and cost reductions are enhanced. When the work of technology is compared with manual work, technology is extremely efficient. Second, it is extremely cheaper in the end when using technology as compared to when using manual programs (Beaumont 2009). This is because many costs are associated with manual programs. In this case, technology as a strategy is in line with one of the supply chain visions. This is the improvement of quality in the production process and reducing cost as much as possible. For this reason, the use of technology will gradually benefit the supply chain of a dominant company (ZDNet Australia 2004).

In conclusion, the above strategies when used by a dominant supplier they will ensure effectiveness in the supply chain and at the same time, they will enhance the chances of a dominant supplier remaining dominant in the market all the times. Therefore, applications of these strategies should be employed by all the suppliers to increase competition leading to increased quality benefiting the consumers in the end.