Supplier
A supplier is any provider of inputs (resources) required for the production process.
Example: In general, a business may require the supply of raw materials, equipment, machinery, finance and information.
Having multiple suppliers means a business is less vulnerable to supply difficulties and the consequence of price rises. However, it also challenges the business in taking control over these supplier groups and their activities.
Supply chain
Supply chain is a system or process in which resources, information, organisations and people collaborate to move a product or a service from suppliers to manufacturers and then on to consumers.
A map of a general supply chain
The supply chain typically starts with the sourcing of natural resources, followed by manufacturing activities (i.g. component construction, assembly). Then, it moves on to storage facilities before finally devlivering to the customers.
Extended theories: Key takeways for businesses to optimise their supply chain
The business owner must not only assess the distance between the business and its suppliers, but also consider the efficiency of delivery, the rate that stock used, consistency in quality, and pricing and comparisons with other suppliers of similar products in order to select the best suppliers to work with.
Sourcing local resources and products grown in Australia.
Entering into long-term contracts with suppliers to tie them into specific prices and quantities.
Outsourcing the transportation and distribution to a third-party logistics provider.
Considering developing more sustainable supply chains or ‘greener’ supply chains. Businesses should also expect their suppliers to behave in a socially responsible manner.
For businesses sourcing their products from overseas manufacturers, they should integrate codes of conduct and guidelines into the management of their supply chain. They should also check their suppliers' social audits to confirm the suppliers' compliance with the required standards of the business.
Example: McDonald's Australia Suppliers and Supply Chain
Source: McDonald’s Supply Chain Issues and Process (Blessing Peter Titus 2023)
McDonald's strategies in selecting their suppliers and developing a sustainable supply chain:
Entering a long-term contract with trusted suppliers: Many of McDonald's Australia suppliers have worked with the brand for decades; some since the brand opened its very first restaurant in Yagoona in 1971.
Sourcing local resources: Macca’s is committed to supporting Australian producers and manufacturers and its first preference is always to source produce from within Australia.
Codes of Conduct: McDonald's implements a global Code of Conduct for Suppliers which outlines the company's minimum requirements in terms of employment and workplace practices. This is to ensure suppliers meeting the company's social responsibility expectations.
For more information, please view this website: Our suppliers | McDonald's Australia (mcdonalds.com.au)
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