Evaluating the distribution
Systems in delivering
Goods and services
For a selected organisation
My selected organisation is Tesco (food). I will evaluate the supply chain and how the distribution channels like direct channels, the retailer customer process, Wholesaler-retailer-customer process and Producer-wholesaler-retailer-customer process. I will also mention aspects such as logistics,shipping, online distribution, customer loyalty and many other channels are operated.
I will start off with how Tesco operate in direct channels in how the producer supplies or serves directly to a consumer, without any wholesalers. So ,Tesco as its direct, the channel process will be shorted meaning some food products will have to be distributed from the UK however specific types of food will be distributed from abroad, meaning the cost will be less and the company will have more fresh products . I think by Tesco using this process, the company will save money because instead of distributing from producers and working the process through wholesalers Tesco can avoid spending money on the wholesalers. However Tesco will not get the food products packaged like it would be if Tesco went to the wholesalers so Tesco must make sure that the producers are reliable and have good quality so the money is not wasted on liabilities like bad producers. In order to make profit Tesco use fresh foods like fruits, vegetables and meat, Tesco put the price up when the foods are fresh, knowing that customers always want fresh food so Tesco took advantage and made the foods expensive that way Tesco make more money than usual. In my opinion I think this strategy from Tesco is very smart and useful for the company because the company is getting foods from farmers at a reasonable price and then selling the foods for more benefits the business. Tesco makes good profit from this operation. Overall in direct channels I think it’s good that Tesco save money but the company could improve if there is an available deal from the wholesalers which is not to expensive but honestly I can’t see that happening and Tesco will continue to buy directly from producers especially for food types such as fruits as the company makes a good profit all the time when selling fresh foods.
Another operation is the retailer – customer process. This process is basically the stage where the retailers sell the foods to the customers. An important aspect of his process is customer loyalty, the customers demand good quality products, and in this case the food from Tesco’s is very important for the retailers to retain good numbers in customers. Like mentioned before Tesco must find good producers who produce good quality foods, by selling off the goods fresh and for a good price that satisfies the customers. I think that this stage is crucial for a business, of course getting the goods is important but that will mean nothing if Tesco doesn’t sell the products off to make the money. Tesco use this process well and that’s why the company is such a success, Tesco are reliable and customers have gained a good trust with the company, customers have stayed loyal to Tesco because Tesco’s supply chain has always pleased customers and honestly I think it always will please customers because the status and establishment of the company is at such a high standard.
Wholesaler-retailer-customer process is the stage when the products are packaged and sent to retailers and then sold off to customers. The main features of this stage are transportation, storage, time management and logistics. Tesco receive many foods and drinks from wholesalers such as Cereals, baked beans, soft drink bottles, alcoholic drink and so many other products. What’s important for Tesco is that the transportation is important, Tesco do this well, Tesco expect the items to arrive in good condition from wholesalers. This benefits Tesco because the wholesalers know the demands of Tesco and the wholesalers will transport the products carefully and on time. Another important feature is time, Tesco must get products on store and the wholesalers must be reliable to get the products to the retail on time. I think Tesco’s high demands benefits the whole process as the wholesalers do their jobs properly and Tesco receive the products on time to sell to the customers. In the later stage of this process is storage, this also links with the stages before which I have just mentioned. Tesco must always get storage from wholesalers, that is vital for the success of the company, Tesco have found reliable wholesalers to benefit the company’s storage, the wholesalers are good all round and have meet an agreement with Tesco, I think Tesco have found good wholesalers and that’s the reason why the company’s storage department is such a success, the impressive supply chain Tesco works within is the reason why Tesco have achieved so much.
The Producer-wholesaler-retailer-customer process is the busiest stage of the supply chain, the stage starts from the producers who sell of their goods to wholesalers, the wholesaler’s package and transport the products when bought from retailers who will later finish off the stage by stocking and selling the products to customers. In my opinion I think this is the most important process of supply chain, especially for a company like Tesco who need products such as baked beans and chocolates to sell that go through the process of being produced by the farmers at the first stage of supply, the wholesalers need to package and transport the goods to the retailers so in this instance Tesco being the retailer receive the goods from the long process. Tesco operate well in this process because it is very difficult to have good producers and wholesalers feeding the goods for a company but Tesco have seemed to found a worthy wholesaler and producers. This operation from Tesco for me gets a 9/10 because the resources are so reliable, the timing is good, the logistics is operated well and there isn’t really anything wrong in the process but it can be improved so that is why I have rated the process a 9/10 rather than a full on 10/10. Tesco can of course improve, that could be improving on how manage to the loyalty of the resources, sometimes there is change in producers or wholesalers but however the overall quality is good so Tesco will always have good quality products as the producers and wholesalers find it easy taking orders from Tesco because the connection is very close, I think that’s vital for Tesco to have such a well worked organisation as there is less problems for the company.
To round it all up Tesco’s distribution in supply chains is at a very high standard and the quality of the resources in every process justifies my point of Tesco being such a success because of the process of the supply chains, all the stages are important and some are more important that others but overall every stage is just feature of Tesco’s success.