Supply Chain Management at DIMCO The supply chain relates to the entire cycle and process through which raw materials are purchased, processed and developed in to goods and services which can be traded in the market. The management of such a process would involve creating improvements in the supply chain itself to make it more profitable and efficient for the company (Davis, 1993). Therefore the supply chain encompasses not only raw material providers or experts that provide their services during the production period but also the distribution channels the company adopts, and its internal production departments and channels.

The Durham International Manufacturing Company has the option to either improve its supply chain with its suppliers or its distributors, and considering that DIMCO has already settled in to the markets it is currently trading in; it would be more beneficial to work on the company's connection with its suppliers.

By improving relations with suppliers as well as better organizing how raw materials reach the production plant, DIMCO can be sure to decrease production time for each unit produced as well as decrease wastage during production. Also by having a better network of suppliers in place DIMCO will be more likely to source products more cost effectively and also be able to manage the right materials when they are needed rather than wasting time either searching for the raw materials or purchasing them at a higher cost. Not to mention that once the supply...

By enhancing relations with the suppliers it may also be possible for DIMCO to find substitutes for raw materials they are currently using, or to find superior products altogether which they can use both to increase the end products' quality, or to lower its price. In order to improve its current relations with suppliers DIMCO may consider issuing some form of extrinsic incentive for its suppliers which may include things such as smaller credit periods. By paying off their credit to suppliers faster they are decreasing the risk for suppliers and so suppliers would be more interested in working with a party which involves less risk than others. The company might choose to develop contracts with its suppliers, so that the suppliers will be doing business for a certain amount of time. This would make DIMCO a more reliable party to do business with as there is a contract which both parties will adhere to. DIMCO can also choose to give its suppliers a larger prepayment for each consignment so that the amount the suppliers have to recover is smaller (Cyert & March, 1963). One of the most beneficial things that can be done to improve the relation between DIMCO and its' suppliers is to create a B2B e-commerce system.
Through this online inter-business trade and communication platform it will be far easier for both firms to stay up-to-date with…