What is the primary function of a supply chain?

The primary function of a supply chain is to create and deliver products or services. This encompasses the entire process from sourcing raw materials to manufacturing and distributing the final product to the consumer. A well-functioning supply chain ensures that products are available when and where they are needed, thus facilitating efficient operations and customer satisfaction.

The creation aspect involves all the activities related to the transformation of raw materials into finished goods, including production planning, manufacturing, and assembly. The delivery component includes logistics, warehousing, and distribution, ensuring that products reach end-users promptly and in good condition. A focus on this fundamental function helps organizations serve their customers effectively, balancing production capabilities with demand.

While reducing costs, increasing sales, and managing customer relations are important elements in the overall business strategy, they are secondary aspects that depend on the efficient functioning of the supply chain. For example, you may reduce costs by optimizing the supply chain, but that is not its primary purpose. The main goal remains the creation and delivery process, which is essential for meeting customer needs and driving business success.