The manufacturing production process can be pictured like a river. Companies, regardless of their sizes and business sectors, all have to rely on suppliers. It can be related to purchasing raw materials, transport services, office. A supply chain includes all the businesses involved in getting a finished product to the market. You might hear the words upstream and downstream when referring to various stops along the chain.
You must first know the particular stop along the way where the terms are used to know exactly what they.
Simultaneously achieving good levels of customer service and low costs for the company. Raw material extraction or production in the oil and gas supply chain are considered upstream , while processes closer to the end user are downstream. Whereas, down stream supply chain is when we have products based on customer needs and distribute them through distribution requirements planning. The whole upstream and downstream supply chain is controlled by a two supply chain tools called MRPII and sales and operations planning (SOP). LINKAGE BETWEEN UPSTREAM AND DOWNSTREAM IN VALUE CHAIN.
The closer to the end user a function or firm is, further downstream it is said. Continue reading “Upstream downstream value chain”