SCM Supply Chain Management

Chapter 1 Overview of Supply Chain Management (SCM)

Supply Chain Management (SCM) is a systematic management philosophy and methodology that, centered on core enterprises, plans, organizes, coordinates, controls and optimizes activities along the entire supply chain—from raw material procurement and component supply, through manufacturing, warehousing and distribution, to end-sales and after-sales service. It emphasizes incorporating suppliers, manufacturers, distributors, retailers and even end consumers into a unified collaborative network, and, through the efficient interconnection of information flows, material flows and capital flows, achieves the optimal overall cost, the fastest response and controllable risk across the supply chain. As informatization and digitalization have advanced, SCM has evolved from a single internal enterprise management tool into a modern supply chain management platform delivered through software systems, driven by data and operating across organizational boundaries.

A complete SCM system typically comprises core modules including planning management, procurement management, production management, warehouse management (WMS), transportation management (TMS), order management, sales and distribution management, supplier relationship management (SRM), and supply chain collaboration and visualization. These modules do not operate in isolation; instead, they achieve information sharing and linkage through a unified data middle platform and a business process engine. For example, the demand signals output by the sales forecasting module are automatically transmitted to the procurement and production planning modules, which in turn drive the deployment of warehousing and transportation resources and ultimately feed back to the execution layer to form a closed loop. This integrated design enables enterprises to manage the complete value chain from demand to delivery on a single platform.

The value that an SCM system brings to an enterprise is multifaceted. First, it significantly enhances supply chain transparency and visibility, enabling managers to grasp inventory, order, in-transit and delivery status in real time. Second, it optimizes inventory levels, reducing capital occupation while ensuring supply and mitigating the risks of obsolescence and stock-outs. Third, it improves responsiveness to market demand, shortening order fulfillment cycles through the coordination of planning and execution. Fourth, it strengthens upstream and downstream collaboration, building closer partnerships with suppliers and customers. Fifth, it enhances supply chain resilience, reducing the impact of supply disruptions and unexpected events through risk early-warning and multi-source coordination. For these reasons, supply chain management has become a key lever for modern enterprises to enhance their core competitiveness.

Chapter 2  Industries Requiring Supply Chain Management and Typical Application Scenarios

Supply chain management is not an exclusive tool for any single type of enterprise; rather, it is a universal capability from which nearly all industries involved in the production, circulation and sale of physical goods can benefit. Whether in manufacturing and processing, trade and circulation, pharmaceuticals and healthcare, the automotive industry, food and fast-moving consumer goods (FMCG), or professional logistics, business operations inherently rely on complex and dynamic supply chain networks. Faced with increasingly intense market competition, ever-higher customer expectations and a volatile external environment, enterprises in a growing number of industries are adopting SCM systems to restructure business processes, break down information silos, control operating costs and improve service levels.

This chapter selects six representative industries—manufacturing; retail and e-commerce; pharmaceutical and medical devices; automotive and components; food and FMCG; and logistics and supply chain services—and elaborates on their respective supply chain management needs, each illustrated with concrete application scenarios that demonstrate how SCM systems are implemented and create value in these contexts. Each scenario starts from the industry background and pain points, and describes the system's application process, key functions and expected outcomes, helping readers understand how SCM is applied in practice across different industries.

2.1  Manufacturing

Manufacturing is one of the industries where supply chain management is most widely applied and most urgently needed. The supply chains of modern manufacturing enterprises often span multiple tiers of suppliers and involve thousands of raw materials and components. They must simultaneously accommodate flexible production requirements characterized by multiple product varieties and small batch sizes, while coordinating the tight linkage of multiple processes including procurement, planning, production, warehousing, quality inspection and shipping. Without effective supply chain management, enterprises are prone to problems such as the coexistence of inventory build-up and stock-out-driven production stoppages, frequent production plan changes and lagging information transmission, all of which directly undermine delivery efficiency and profitability.

Scenario 1: Plan–Procurement–Production Collaboration in High-Mix, Low-Volume Discrete Manufacturing

(1) Scenario Background

In industries such as equipment manufacturing, machining and electronic components, orders tend to feature multiple product varieties, small batch sizes and tight delivery deadlines. Each order involves a different bill of materials, customers are highly sensitive to delivery time, and raw material procurement lead times are relatively long. Traditional scheduling based on experience and manual order tracking struggles to strike an optimal balance between complex and volatile order structures on the one hand and limited capacity and material resources on the other. A shortage of even a single material can halt an entire production line, while duplicate procurement of some materials drives up inventory. Manufacturing enterprises urgently need a management mechanism that links sales demand, material planning and production scheduling, fundamentally alleviating the disconnect between planning and execution.

(2) System Application Process

After introducing an SCM system, the enterprise first imports historical sales data and on-hand orders into the demand planning module, which uses forecasting algorithms to generate a rolling demand plan. Based on the bill of materials, the system automatically expands material requirements planning (MRP) and, by taking into account current inventory, safety stock, in-transit purchases and already-released production orders, calculates precise net requirements, from which it generates procurement suggestions and production suggestions. The production planning module then converts the production suggestions into executable daily scheduling plans based on equipment capacity, shift patterns and workstation constraints, and synchronizes the scheduling results back to the procurement module so that material arrival times precisely match production start times. During execution, the system captures workshop work-reporting, material-issuance and incoming-goods data in real time; whenever an exception occurs (such as supplier delays or equipment failures), the system automatically triggers an early warning and recommends adjustments to scheduling or procurement priorities. Through this collaborative mechanism, the enterprise is able to maintain high material kitting rates and capacity utilization while meeting volatile order demand, significantly shortening order delivery cycles and reducing work-in-process (WIP) inventory.

Scenario 2: Multi-Tier Supplier Collaboration for Raw Materials and Components

(1) Scenario Background

The supply chains of large manufacturing enterprises often comprise first-tier, second-tier and even more tiers of suppliers. Between the core enterprise and its many suppliers there exists both close collaboration and natural information barriers. Without a unified collaboration platform, suppliers are often unable to learn the core enterprise's true demand and plan changes in a timely manner and can only prepare materials based on experience, easily resulting in over-supply or short-supply; conversely, the core enterprise struggles to grasp suppliers' production progress, inventory and capacity constraints, making supply chain risks difficult to anticipate. Particularly during raw material price fluctuations, tight supply or sudden shortages, the collaboration capability among multi-tier suppliers directly determines whether the enterprise can maintain continuous production.

(2) System Application Process

The supplier relationship management (SRM) and procurement collaboration functions of the SCM system establish a digital collaboration channel between the enterprise and its multi-tier suppliers. The system shares the core enterprise's rolling demand forecasts, purchase orders, delivery plans and quality requirements with suppliers at all tiers in real time through a supplier collaboration portal, on which suppliers confirm capacity online, reply with delivery dates and report delivery plans. The system automatically aggregates commitment data from suppliers at all tiers, matches and validates them against the core enterprise's demand, and promptly flags capacity gaps or delivery risks. Procurement and planning personnel can dynamically adjust procurement strategies based on suppliers' real-time feedback and, where necessary, reallocate orders among multiple qualified suppliers. For critical components, the system also supports vendor-managed inventory (VMI) collaboration, under which suppliers maintain consignment inventory at the core enterprise's site and the core enterprise settles based on actual consumption. Through this deep collaboration, the core enterprise can build a more stable and transparent supply network, improve material assurance and reduce procurement and inventory costs.

Scenario 3: Manufacturing Execution and Work-in-Process Inventory Visualization

(1) Scenario Background

On the production floor, many manufacturing enterprises still rely on paper documents and manual reporting to track production progress and WIP status. Data collection is untimely and inaccurate, leaving management without a clear picture of critical information such as how much WIP is on the line, which processes are being worked on, and which orders are approaching their delivery deadlines. This black-box management not only hampers the flexibility of production scheduling but also tends to cause WIP build-up, stagnant semi-finished goods, and quality issues that are difficult to trace in a timely manner, thereby raising production costs and weakening the enterprise's control over delivery dates.

(2) System Application Process

By integrating SCM with manufacturing execution system (MES) capabilities, the enterprise is able to achieve end-to-end digital management of the entire process from material release, processing and inspection to warehousing. Through barcodes or RFID, the system establishes unique identifiers for every material batch, work order and workstation; employees scan and report work at key process steps, and the system updates the quantity, location and status of WIP in real time. Through visualization dashboards, production managers can grasp at a glance the real-time progress of each line and work order, the distribution of WIP and bottleneck processes, and dynamically adjust production tempo and resource allocation accordingly. When WIP build-up exceeds a preset threshold, the system automatically issues an early warning and prompts dispatchers to take diversion or rush measures. At the same time, the system automatically links completed-and-warehoused data with finished goods inventory and sales orders to ensure that records match physical stock. The system also compares work-order reporting data against standard working hours to analyze deviations in process efficiency and suggest improvement directions, providing a basis for process optimization and capacity assessment. Through end-to-end visualization, the enterprise not only substantially reduces capital tied up in WIP, but also improves the execution rate of production plans and the speed of exception response, achieving full-chain state transparency from materials and WIP to finished goods. This provides solid data support for continuous optimization of production and cost accounting, and furnishes managers with timely and accurate evidence for operational decision-making.

2.2  Retail and E-commerce

The retail and e-commerce industry directly serves end consumers and is characterized by massive order volumes, diverse channels and pronounced demand fluctuations, making it a high-frequency application scenario for supply chain management. With the popularization of omnichannel models that integrate online and offline operations, enterprises must simultaneously manage multiple sales channels including physical stores, e-commerce platforms, livestream commerce and community distribution. Inaccurate inventory or delayed fulfillment at any touchpoint directly affects customer experience and sales conversion. How to achieve unified omnichannel inventory control, intelligent order allocation and timely, efficient fulfillment has become a common supply chain challenge for retail enterprises.

Scenario 1: Omnichannel Order Fulfillment and Intelligent Inventory Allocation

(1) Scenario Background

In the new retail environment, the same product may be sold through multiple channels simultaneously. If inventory at each channel is managed independently, fragmented inventory situations readily arise—such as a product shown as available online while actually out of stock, or stores out of stock while warehouses hold surplus. After a consumer places an order, the enterprise must fulfill it from the most appropriate warehouse or store in the shortest possible time to control logistics costs and enhance the delivery experience. However, if the prioritization of multi-channel orders, the selection of fulfillment warehouses, order splitting and consolidation strategies, and inventory deduction rules all depend entirely on manual processing, the operation is both slow and error-prone, and cannot support the high-concurrency, multi-touchpoint demands of modern retail.

(2) System Application Process

The order management (OMS) and inventory management modules of the SCM system establish a unified omnichannel shared inventory view. The system aggregates inventory data from all warehouses, stores and channels in real time and, applying an intelligent allocation engine that weighs factors such as channel priority, logistics distance, inventory availability and fulfillment cost, recommends the optimal fulfillment node for each order. Once an order is released, the system automatically performs inventory deduction, wave allocation and picking-instruction issuance, supports multiple fulfillment modes such as cross-warehouse transfers, store shipping and self-pickup, and can automatically split or consolidate orders based on inventory and transport capacity. The system also supports mechanisms such as pre-sales, overselling control and safety stock reservation to prevent out-of-stock caused by overselling. To cope with surge traffic during major promotions, the system relies on high-concurrency processing and queued scheduling to ensure that fulfillment tasks execute in an orderly manner when orders flood in, avoiding system congestion or order backlog. Through unified scheduling, the enterprise achieves online-offline inventory coordination and efficient order fulfillment, effectively reducing logistics costs and shortening delivery times, while eliminating the zero-sum inventory imbalances across channels and improving overall inventory turnover and customer satisfaction.

Scenario 2: Multi-Echelon Warehousing and Intelligent Replenishment

(1) Scenario Background

Retail enterprises' inventory is typically distributed across multiple echelon nodes such as regional warehouses, forward warehouses and stores, each serving a different service radius and replenishment function. If replenishment decisions lack a scientific basis and rely only on experience or sales estimates, the coexistence of stock-outs of fast-moving items and overstock of slow-moving items easily occurs. At the same time, multi-echelon warehousing also involves ordering from suppliers, transfers among warehouses at various levels and allocation to stores—a long chain with many links. If information flow is poor, the bullwhip effect is amplified and deviations between inventory and demand are magnified at each level. Retail enterprises therefore need an intelligent replenishment and inventory-balancing mechanism that links suppliers, central warehouses, regional warehouses and stores.

(2) System Application Process

The demand forecasting and intelligent replenishment functions of the SCM system forecast demand for each SKU at each warehousing node based on historical sales, promotion plans, seasonal factors and channel characteristics, and accordingly generate tiered replenishment recommendations. The system comprehensively considers current inventory at each warehouse level, safety stock, in-transit orders, supply lead times and logistics costs, and automatically calculates replenishment quantities, replenishment nodes and transfer routes, producing a step-by-step replenishment and transfer plan from suppliers to the central warehouse, from the central warehouse to regional warehouses, and from regional warehouses to stores. For scenarios requiring cross-level direct delivery or direct store shipment, the system also supports flexible configuration. Once generated, replenishment plans are automatically pushed to the procurement and transportation modules, enabling integrated execution of ordering, transfer and delivery. Through intelligent replenishment, the enterprise is able to reduce overall inventory holding costs while ensuring supply to stores and channels, cut down stock-outs and overstock, and improve turnover efficiency and capital utilization across all warehouse levels.

Scenario 3: Last-Mile Delivery and Reverse Logistics for Returns and Exchanges

(1) Scenario Background

The last-mile end of the retail and e-commerce fulfillment chain is the most tangible point of customer experience; delivery timeliness, package status visibility and the convenience of returns and exchanges directly shape customers' overall evaluation of a brand. As order volumes grow, route planning for last-mile delivery, coordination of courier resources and handling of exceptional packages become increasingly complex. At the same time, the volume of reverse logistics arising from returns and exchanges keeps rising. If returns are not processed promptly or return-product information is unclear, the result is inflated inventory, tied-up capital and resource waste. Enterprises need efficient, visible management in both the forward delivery and reverse return directions.

(2) System Application Process

The transportation management (TMS) and reverse logistics modules of the SCM system bring last-mile delivery and returns/exchanges under unified digital management. In the forward delivery process, the system intelligently plans delivery routes based on order destinations, package weight and dimensions, and delivery time requirements, and matches the optimal courier or transport resources, supporting bidding and scheduling among multiple carriers; after an order leaves the warehouse, the system, through integration with carrier systems, feeds back pick-up, transit and delivery node information in real time, allowing customers to query package tracking at any time. In the reverse logistics process, the system establishes a complete workflow for return orders covering return-to-warehouse, quality inspection, re-shelving or scrapping. Once a returned package is received, a receipt record is generated; goods that pass quality inspection re-enter salable inventory, while defective or damaged goods enter the disposal process, enabling rapid resale of returns and capital recovery. Through unified, visible management of forward and reverse flows, the enterprise significantly improves last-mile delivery timeliness and return-handling efficiency, reduces reverse logistics costs, and enhances the consumer shopping experience.

2.3  Pharmaceutical and Medical Device Industry

The pharmaceutical and medical device industry imposes extremely stringent requirements on supply chain compliance, safety and traceability. Every stage of pharmaceutical and medical device flow—from production and distribution to use—is subject to special constraints concerning quality safety, expiry management, cold-chain temperature control and regulatory compliance. Meanwhile, procurement needs differ greatly across downstream customers such as hospitals, pharmacies and distributors, and stock-outs or near-expiry risks are directly related to medication safety. For this reason, the industry's demand for supply chain management lies not only in efficiency but, more fundamentally, in quality control and accountability traceability across the entire chain.

Scenario 1: End-to-End Pharmaceutical Quality Traceability

(1) Scenario Background

Drug safety bears directly on the life and health of the people, and national regulators impose strict traceability requirements on drug distribution, requiring full end-to-end traceability from production through distribution to use. However, the pharmaceutical supply chain involves many stages and complex participating entities—including manufacturers, wholesalers, distributors, hospitals and pharmacies. Traditional manual ledgers and segmented records are unable to form a complete traceability chain. When a quality incident occurs or an urgent recall is required, the enterprise often cannot locate the specific batch, flow direction and inventory position in a short time, resulting in low handling efficiency and enormous risk. Building a traceability system covering the entire pharmaceutical chain has become a foundational capability that pharmaceutical enterprises must establish.

(2) System Application Process

By establishing a batch management system built around drug traceability codes (or electronic supervision codes), the SCM system achieves quality traceability across the full lifecycle of pharmaceuticals. At the procurement and warehousing stage, the system collects and registers traceability information for each batch of drugs, linking production batch numbers, inspection reports and supplier qualifications; throughout sales outbound, transfer and distribution, the system automatically records the flow nodes, handling entities and receipt status of each package of drugs, forming a complete traceability map from supplier to end user. Managers can quickly query the whereabouts and on-hand status of any drug from multiple dimensions such as batch, flow direction and time. When a quality warning occurs or regulators require action, the system can generate an accurate recall list within a short time, lock down all flow directions and remaining inventory of the affected batches, and drive the closed-loop issuance and execution of recall instructions. Through full-chain traceability, the enterprise not only satisfies regulatory compliance requirements, but also enhances quality safety control and its ability to respond quickly to unexpected events.

Scenario 2: Temperature-Controlled Cold Chain and Expiry Management

(1) Scenario Background

Many drugs (such as vaccines, biological products and blood products) have strict requirements for storage and transport temperature and must be kept refrigerated or frozen throughout the specified temperature range; any temperature deviation at any stage may affect the efficacy and safety of the drug. At the same time, drugs generally have explicit expiry dates. Drugs approaching expiry need priority outbound and timely warning to prevent expired drugs from entering the market and causing safety risks. If cold-chain warehousing, in-transit temperature data recording and expiry management rely on manual inspection and paper records, they are not only time-consuming and labor-intensive but also difficult to ensure data completeness and real-time accuracy, posing significant quality hazards.

(2) System Application Process

The SCM system provides dedicated digital capabilities for pharmaceutical cold chain and expiry management. In warehousing, the system interfaces with cold-room temperature monitoring equipment to collect and record temperature data at each cold room and storage location in real time, and automatically raises alarms and triggers handling procedures when temperatures exceed the preset range; in transportation, the system interfaces with cold-chain vehicles and temperature recorder devices to monitor in-transit temperature profiles in real time, ensuring that temperature control is traceable throughout. For expiry management, the system sets expiry attributes for each drug batch, automatically calculates remaining shelf life, follows the "first-in, first-out; near-expiry-first-out" rule at outbound, and issues early warnings for drugs approaching expiry, prompting business personnel to handle or return/exchange them in a timely manner. The system also links expiry information with procurement and sales planning to avoid excess purchasing that leads to accumulation and expiration. Through digital cold-chain and expiry management, the enterprise effectively safeguards drug quality and safety, reduces the risk of quality incidents and expiration losses, and retains complete compliance records of temperature control and shelf life.

Scenario 3: In-Hospital Materials and Consumables Management

(1) Scenario Background

Hospitals are a major terminal user of drugs and medical devices. Their in-hospital materials are numerous in variety and highly volatile in usage, covering drugs, consumables, reagents and other categories. Hospitals must both ensure uninterrupted material supply to clinical departments and control inventory capital occupation and prevent waste. Moreover, high-value consumables and implantable devices often need to be associated with patient and surgical information and subject to strict admission, requisition and traceability management. Traditional manual requisition, inbound/outbound and stocktaking methods suffer from data lag, discrepancies between records and physical stock, and consumable loss, and are inadequate for the requirements of refined management and compliant traceability.

(2) System Application Process

The in-hospital supply chain management function of the SCM system establishes a full-process digital management system for hospitals covering procurement planning, acceptance and warehousing, departmental requisition, and clinical consumption. Based on departmental historical consumption and clinical schedules, the system generates reasonable procurement and stock-preparation plans and, through integration with supplier systems, enables automatic ordering and arrival tracking; at warehousing, barcodes enable rapid registration of item name, batch number, expiry date and quantity to ensure records match physical stock. Departments submit online requisitions, which the system automatically reviews and releases according to permissions and budgets while updating inventory in real time. For high-value consumables, the system implements "one-item-one-code" management, binding consumables to patient and surgical information to form a closed loop of use and traceability. The system also supports integration with hospital information systems (HIS), linking supply chain data with clinical business data so that managers can reverse-derive procurement and inventory strategies from clinical demand and more accurately grasp the material consumption patterns of different departments and procedures. The system provides multi-dimensional reports on inventory turnover, consumption analysis and expiry warning to help hospitals optimize inventory structure. Through refined, digital management of in-hospital materials, hospitals effectively control inventory costs while ensuring clinical supply, and improve the compliance and transparency of consumable use.

2.4  Automotive and Components Industry

The automotive industry is a typical sector where discrete manufacturing coexists with highly coordinated operations. Its supply chain is characterized by a wide variety of components, a large supplier system, rigorous planning cadence and stringent quality requirements. Original equipment manufacturers (OEMs) and component suppliers generally adopt finely tuned collaboration models such as just-in-time (JIT) and just-in-sequence (JIS) supply, imposing extremely high demands on planning accuracy, response speed and execution discipline in the supply chain. At the same time, with the expansion of multi-site layouts and the aftermarket, automotive enterprises must also coordinate production supply and spare-parts networks on a larger scale. Supply chain management has therefore become a core pillar of automotive enterprise operations.

Scenario 1: JIT/JIS Synchronized Supply Pull at OEM Plants

(1) Scenario Background

In vehicle assembly, to minimize inventory and ensure assembly cadence, OEMs widely adopt just-in-time supply: components must arrive at the exact time they are needed at the assembly workstation—neither arriving early and causing build-up, nor arriving late and halting the line. JIS synchronized supply goes further, requiring components to be matched one-to-one to specific workstations according to the vehicle assembly sequence. This model imposes extremely stringent requirements on the speed of information transmission, the precision of planning and the execution capability of suppliers. If production plans and supply instructions are not communicated in a timely manner, suppliers cannot prepare materials in synchronization, or delivery sequence is disordered—both directly disrupt normal operation of the vehicle assembly line and cause serious losses.

(2) System Application Process

The SCM system is deeply integrated with the OEM's production planning system to build a lean supply system centered on pull. The system shares the vehicle production sequence and vehicle configuration information with the relevant component suppliers in real time, and generates JIT supply requirements and JIS sequence supply instructions according to the assembly sequence, specifying the type, quantity and sequencing requirements of components for each workstation and time point. After receiving instructions through the collaboration portal, suppliers prepare materials in sequence and arrange on-time delivery; the system tracks the in-transit position and estimated arrival time of delivery vehicles in real time, precisely matching the assembly cadence of the production line. The system automatically calculates and warns on key indicators such as delivery punctuality rate and sequence conformance rate; whenever a deviation occurs, it immediately prompts both parties to coordinate and resolve. At the same time, the system feeds back receiving, line-feeding and consumption data in real time to dynamically adjust subsequent supply plans. Through this pull-based collaboration, the OEM effectively controls line-side inventory and reduces line-stop risk, while suppliers achieve more precise production organization, jointly improving the operational efficiency of the entire supply chain.

Scenario 2: Multi-Site, Multi-Plant Coordination and Vendor-Managed Inventory

(1) Scenario Background

Large automotive groups often deploy vehicle and component plants across multiple regions. Each site differs in product structure, capacity and procurement systems, and suppliers must serve multiple plants simultaneously. If each site is managed independently and information is not shared, problems easily arise such as imbalanced capacity allocation by the same supplier across different plants, zero-sum fluctuations in component inventory, and a lack of overall coordination in purchase prices and quotas. At the same time, many critical components adopt a vendor-managed inventory (VMI) model, under which suppliers maintain consignment inventory at or near the OEM's plant. The replenishment cadence, consumption settlement and division of responsibilities for this inventory all require clear coordination and are highly complex to manage.

(2) System Application Process

The SCM system provides automotive groups with an integrated multi-site supply chain collaboration platform. The system centrally manages production plans, procurement requirements and inventory information across all sites, and coordinates suppliers' capacity allocation and supply quotas among multiple plants to avoid duplicate procurement and resource waste. For the VMI model, the system establishes a consignment inventory management mechanism: suppliers maintain a set safety stock at designated warehouses or line-side locations according to the agreement, and the system updates consignment inventory quantities in real time based on the OEM's actual consumption and generates replenishment requirements, on which suppliers arrange replenishment; consumption data is settled with suppliers on agreed cycles, enabling clear management of inventory ownership and consumption. The system also supports cross-site material transfers: when one site faces a material shortage while another holds surplus inventory, transfer recommendations are automatically generated. Through multi-site and VMI coordination, the automotive group achieves optimized allocation of supply chain resources, ensuring continuous production at each plant while reducing overall inventory levels and supply chain coordination costs.

Scenario 3: After-Sales Spare Parts Network and After-Sales Supply Chain

(1) Scenario Background

After a vehicle is sold, the supply of after-sales spare parts directly affects the customer's driving experience and the brand's reputation. Automotive spare parts number in the tens of thousands of varieties, with dispersed demand and volatile sales. Enterprises must both ensure timely supply of fast-moving parts and control the accumulation of slow-moving spare-parts inventory—a difficult supply chain management challenge. Meanwhile, in the multi-echelon spare-parts network comprising the OEM, central spare-parts warehouses, regional sub-warehouses and dealers, the transfer, replenishment and emergency order handling of spare parts, if lacking efficient coordination, easily lead to stock-outs of fast-moving parts and overstock of slow-moving parts, lengthening customer wait times and tying up substantial capital.

(2) System Application Process

The SCM system establishes a multi-echelon distribution spare-parts supply chain management system for automotive after-sales. Based on historical repair data, vehicle parc and seasonal factors, the system forecasts demand for each spare part and accordingly develops step-by-step replenishment plans for central warehouses, regional warehouses and dealers, rationally setting safety stock at each level. For emergency orders, the system provides rush supply and cross-regional transfer mechanisms, prioritizing the allocation of spare parts from the nearest node with sufficient inventory, and tracks the in-transit status of spare parts in real time, providing dealers and customers with predictable arrival times. The system continuously monitors the age, dormancy and turnover of spare parts, and proposes handling recommendations for parts that have not moved for a long time to avoid capital stagnation. At the same time, the system supports integration with the OEM's parts catalog and electronic service records to improve the accuracy and efficiency of parts identification. Through digital management of the multi-echelon spare-parts network, automotive enterprises significantly improve after-sales spare parts supply, shorten customer wait times, optimize spare-parts inventory structure, and reduce the overall cost of the after-sales supply chain.

2.5  Food and FMCG Industry

The food and FMCG industry is characterized by numerous product categories, extensive sales channels, thin per-unit profit margins and volatile consumer demand, placing high demands on supply chain cost control, response speed and quality safety. At the same time, products such as food, beverages and daily chemicals generally have shelf-life requirements, and batch management and expiry control directly affect product safety and loss. With the diversified development of modern channels, e-commerce and community retail, FMCG enterprises need more accurate demand forecasting, more efficient replenishment collaboration, and more rigorous traceability and expiry management to maintain an advantage amid intense competition.

Scenario 1: Batch Traceability and Food Safety Recall

(1) Scenario Background

The food industry has rigid requirements for product safety and batch traceability. When a quality problem occurs, the enterprise must quickly locate the specific batch, raw material source, production shift and sales flow so as to rapidly contain the risk and implement a recall. However, the food supply chain involves numerous stages—from raw material procurement, production and processing, and warehousing and distribution to multi-echelon distribution—and information is scattered across different stages and systems, leaving the traceability chain incomplete. Without a unified batch traceability capability, quality incidents often require extensive manual investigation, making it impossible to promptly and precisely lock down the problematic batch. This both expands the scope of risk and may cause unnecessary losses, or even damage brand reputation.

(2) System Application Process

The SCM system establishes a batch traceability system for food enterprises that spans from raw materials to end terminals. At raw material procurement and warehousing, the system registers raw material batch, supplier and inspection information; during production, it links raw material batches with product batches, production dates and line shifts, realizing a traceability logic of "forward inquiry and reverse tracing." After products leave the factory, the system continuously records the flow direction and inventory location of batches at each warehousing, distribution and multi-level distribution stage, forming a complete batch flow map. When a quality warning occurs or regulators intervene, the system can rapidly identify the affected batches' raw material sources, production ranges, all flow channels and current inventory distribution, automatically generate recall scope and handling recommendations, and drive the issuance of recall notifications and progress tracking. Through full-chain batch traceability, food enterprises effectively safeguard product safety, significantly improve the response and handling efficiency of quality incidents, reduce recall costs and brand risk, and retain complete traceability records required for compliance.

Scenario 2: Sales Forecasting and Channel Replenishment Collaboration

(1) Scenario Background

Consumer demand for FMCG products is frequently volatile, influenced by promotions, seasons, channel structure and other factors. At the same time, products need to cover multiple routes—modern channels (supermarkets and hypermarkets), traditional channels (distributors and wholesalers), e-commerce and emerging channels—each with different replenishment rhythms and inventory management methods. If replenishment decisions lack data support, fast-moving products easily go out of stock and miss sales opportunities, or slow-moving products accumulate, occupying capital and warehouse space. Faced with a vast number of SKUs and a complex channel network, enterprises need a scientific forecasting and replenishment collaboration mechanism to balance supply and demand and improve the health of channel inventory.

(2) System Application Process

The demand forecasting and replenishment collaboration functions of the SCM system integrate historical sales, real-time inventory and promotion plan data from all channels, and use statistical models to forecast demand for each SKU at each channel level. The system comprehensively considers channel characteristics, promotion calendars, seasonality and lifecycle factors to generate rolling demand plans, and accordingly outputs differentiated replenishment recommendations for distributors, modern channels and e-commerce platforms. Through integration with distributor and retailer systems, the enterprise achieves online collaboration of replenishment recommendations, orders and reconciliation, reducing manual communication errors. The system continuously monitors channel inventory turnover, stock-out rates and overstock conditions, helping business personnel identify anomalies in a timely manner and adjust strategies. Through scientific forecasting and channel replenishment collaboration, FMCG enterprises significantly improve the health of channel inventory, reduce stock-outs and overstock, raise distribution coverage and end-market fill rates, and provide production and procurement with more accurate demand baselines, overall lowering supply chain operating costs.

Scenario 3: Freshness and Expiry Control

(1) Scenario Background

For FMCG products with strong time sensitivity such as fresh produce, dairy and bakery products, freshness and shelf life directly determine the product's salable value and quality safety. These products have short shelf lives; if inventory turnover is slow or outbound order is improper, large quantities of near-expiry or even expired loss can easily occur, causing economic loss and food safety risks. At the same time, short-shelf-life products impose extremely high demands on supply chain response speed: every stage from production, distribution to terminal sales must be efficiently linked so that products reach consumers within their optimal freshness window. Traditional manual expiry management is difficult to perform at a refined level and urgently requires digital support.

(2) System Application Process

The SCM system establishes a freshness-priority supply chain management mechanism for short-shelf-life products. The system sets strict expiry attributes for each batch of products, and outbound follows the "first-in, first-out; near-expiry-first-out" principle to ensure that earlier-produced products are prioritized for delivery and sale. The system monitors the expiry distribution of inventory at each level in real time; when a batch approaches the near-expiry threshold, it automatically issues an early warning, prompting business personnel to prioritize promotion or handling and avoid expiration losses. In demand forecasting and production planning, the system fully considers the freshness window of short-shelf-life products and, combined with channel sell-through speed and cold-chain capability, optimizes production and replenishment cadence to avoid excess production causing accumulation. For fresh cold-chain products, the system combines expiry management with temperature traceability to ensure products flow within appropriate temperature zones and shelf-life windows, and completely records temperature and batch information for inspection. The system also provides terminal stores with promotion and transfer recommendations for near-expiry goods, helping stores digest inventory within the freshness window. Through refined freshness and expiry management, FMCG enterprises effectively reduce near-expiry and expired losses, enhance product freshness and terminal competitiveness, and safeguard consumers' food safety and shopping experience.

2.6  Logistics and Supply Chain Service Industry

The logistics and supply chain service industry takes the undertaking and operation of supply chain stages as its core business; its service capability is directly reflected in the operational efficiency and customer service levels of warehousing, transportation, distribution and other stages. Faced with massive parcel volumes, multi-warehouse networks and complex transport resources, logistics enterprises must control operating costs while ensuring timeliness and service quality. At the same time, as service providers of the supply chain, logistics enterprises also bear the responsibility of providing customers with in-transit visibility, data integration and collaboration services. The application of supply chain management systems is the key to enhancing their core competitiveness and customer stickiness.

Scenario 1: Multi-Warehouse Network Layout and Warehouse Operation Path Optimization

(1) Scenario Background

As business scale expands, logistics enterprises often deploy central warehouses, regional warehouses and forward warehouses across multiple cities or regions, forming a large multi-warehouse network. How to optimize inventory distribution, order allocation and in-warehouse operation paths across warehouses while meeting timeliness requirements directly determines logistics costs and service quality. If the allocation of goods volume among warehouses is unreasonable, some warehouses become congested while others sit idle, and orders may be assigned to distant warehouses, reducing timeliness and raising transportation costs; unreasonable in-warehouse picking paths slow down operational efficiency. Multi-warehouse coordination and in-warehouse optimization have become important breakthrough points for logistics enterprises to reduce costs and improve efficiency.

(2) System Application Process

The SCM/WMS system provides logistics enterprises with multi-warehouse integration and intelligent in-warehouse optimization capabilities. The system aggregates inventory, order and capacity data from all warehouses and, based on customer distribution, timeliness commitments and logistics costs, intelligently decides which warehouse should fulfill each order, supporting cross-warehouse transfers to balance load and inventory structure across warehouses. At the in-warehouse operation level, the system applies wave strategies and path optimization algorithms to consolidate orders with the same or similar destinations into operation waves and plans optimal picking routes for pickers or automated equipment, reducing ineffective walking and duplicate handling and improving picking and recheck efficiency. The system monitors and analyzes each warehouse's inbound/outbound efficiency, storage utilization and operational bottlenecks in real time, helping managers optimize warehouse network layout and operation processes. Through multi-warehouse coordination and in-warehouse optimization, logistics enterprises significantly improve warehouse resource utilization, shorten order processing and outbound times, reduce unit logistics costs, and provide customers with more stable and efficient warehousing services.

Scenario 2: In-Transit Visibility and Transport Capacity Dispatching

(1) Scenario Background

Transportation is the stage of logistics services with the highest cost share, the most stages and the most uncontrollable factors. Logistics enterprises often manage both self-operated vehicles and external carrier resources simultaneously, with diverse transport routes and uncertain factors such as traffic, weather and timeliness. If the transport process lacks transparency, managers cannot grasp each shipment's in-transit position, estimated arrival time and abnormal conditions, and customers cannot obtain timely and accurate logistics information; if transport capacity dispatching is unreasonable, it results in low vehicle utilization, high empty-running rates and rising transportation costs. Enhancing transport visibility and intelligent transport capacity dispatching is an inevitable requirement for logistics enterprises to improve service levels.

(2) System Application Process

The transportation management (TMS) module of the SCM system establishes a closed-loop management system for logistics enterprises covering order carriage, transport dispatching and in-transit tracking. Based on the origin and destination of orders, timeliness requirements and cargo attributes, the system intelligently matches transport routes and optimal carrier resources, supports bidding and unified dispatching among multiple carriers, and conducts end-to-end tracking of in-transit vehicles. Through integration with onboard terminals and driver apps, the system obtains vehicle positions, driving trajectories and abnormal-stop information in real time, and presents an in-transit visualization dashboard and estimated arrival times to both managers and customers; when route deviation, delay or abnormality occurs, the system automatically issues an early warning and triggers a handling process. The system performs statistical analysis on indicators such as transport capacity utilization, punctuality rate and unit transport cost, assisting managers in optimizing route planning and capacity configuration and reducing empty running and waiting. Through end-to-end transport visualization and intelligent dispatching, logistics enterprises effectively improve transport timeliness and reliability, reduce transportation costs, and provide customers with transparent and trustworthy logistics service experiences.

Scenario 3: Customer Logistics Data Collaboration and Value-Added Services

(1) Scenario Background

As service providers of the supply chain, logistics enterprises not only execute transportation and warehousing but also need to establish close data collaboration with upstream cargo-owner customers. Customers often want to grasp the status, inventory and logistics data of their goods in the supply chain in real time and incorporate them into their own production and sales planning; logistics enterprises also hope to enhance customer stickiness and develop value-added business by providing data services. However, if the two parties' systems are mutually independent and data formats are inconsistent, information must be transferred manually and repeatedly confirmed, resulting in low collaboration efficiency and difficulty supporting in-depth supply chain services. Opening the data channel with customers has become the key for logistics enterprises to enhance service value.

(2) System Application Process

Through open interfaces and a collaboration portal, the SCM system builds a data collaboration platform between logistics enterprises and their cargo-owner customers. The system supports standard-interface integration with customers' ERP, OMS and other systems, enabling automatic exchange and real-time synchronization of order, inventory, shipment and in-transit data, reducing manual entry and repeated reconciliation. Logistics enterprises open a collaboration portal or data dashboard to customers, who can self-service query goods inventory, inbound/outbound records, in-transit trajectories and delivery receipt information, and can initiate ordering, inquiry and settlement online. Based on accumulated logistics and supply chain data, the system can also provide customers with value-added data services such as inventory analysis, timeliness analysis and damage-rate analysis, helping customers optimize their own supply chain decisions. Through data collaboration and value-added services, logistics enterprises significantly improve collaboration efficiency and information transparency with customers, enhance customer stickiness, and expand into higher-value supply chain data service capabilities beyond traditional transportation and warehousing services.