Advantages 1 long term forecasts and planning are

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Advantages: 1. Long-term forecasts and planning are used. 2. Inventory is stored and kept on hand. When products are generic, customization and enhancements can be satisfied quickly and in a timely manner. 3. Can lead to economies of scale in purchasing and production 4. Allows for better planning and controlling as production schedules(MRP and MPS) are independent of short-term immediate demand. Disadvantages: 1) Forecasts are always inaccurate and hence in push system you always have situation of large inventory cost or stockout. Risk of product obsolescence. 2) Can generate large quantities of scrap before errors are discovered 3) Requires diligence to maintain effective product flow 4) Requires large and complex databases
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Examples of Push industry- FMCG Companies: FMCG companies use push industry has the products are standardized and are daily consumables. Paper industry, footwear, Cement industry What is the pull supply chain? In pull supply chain the production and supply are dependent on immediate demand of product. In other words, the goods flow to the end consumer is initiated only when the information of customer demand is passed upwards the supply chain. The supply chain is based on the JIT principle of Toyota which seeks to minimize WIP inventory. JIT seeks to deliver the right amount of product at the right time. Pull supply chain is
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  • Winter '17
  • Vinay V Panicker
  • Forecasting, FMCG Companies

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