Question
Push-based Supply Chain and Pull-based Supply Chain.
Answer :
Word Count : 503
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A push-based supply chain and a pull-based supply chain are two important approaches to managing the flow of goods, information, and inventory in retail supply chain management. They differ mainly in the basis on which production, procurement, and distribution decisions are made. A push-based supply chain operates according to anticipated customer demand. Retailers and suppliers forecast future demand and make decisions about purchasing, production, transportation, and inventory in advance. Goods are pushed through the supply chain from manufacturers to distributors, warehouses, and retail stores, often before actual customer demand is known. For example, a retailer may stock a large quantity of winter clothing before the winter season based on previous sales data and expected demand. The major advantage of this approach is that products are readily available when customers need them. It can also support economies of scale in production and transportation. However, inaccurate forecasts may result in overstocking, excess inventory, markdowns, product obsolescence, and higher storage costs. This is particularly risky in retail because customer preferences can change rapidly. In contrast, a pull-based supply chain is driven by actual customer
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