The problems faced by SCM in today's context are:
(i) Distribution Network Configuration: Number,location and network mission of supplies , production facilities,distribution centres warehouse , cross-docks and customers. Distribution strategy: Operating control (centralization decentralisation or shared) delivery scheme, e.g.,direct shipment, pool point shipping, cross-docking, DSD (Direct Store Delivery), closed-loop shipping; mode of transportation, e.g., motor carrier, including truckload, LTL, and parcel; railroad; intermodal transport, including TOFC (Trailer On Flatcar) and COFC (Container On Flatcar); ocean freight; airfreight; replenishment strategy (e.g., owner-operated, private carrier, common carrier, contract carrier, or3PL).
(ii) Trade-Offs in Logistical Activities: To obtain the lowest overall logistics cost, the aforementioned operations must be carefully integrated. If only one of the tasks is optimised, trade-offs may raise the entire cost. Full truckload (FTL) prices, for example, are less expensive per pallet than Less Than Truckload (LTL) shipments. If, on the other hand, a complete truckload of a product is bought to save money on transportation, inventory holding costs will rise, potentially raising overall logistics costs. When planning logistical tasks, it is therefore critical to use a systems perspective. These tradeoffs are critical in building the most efficient and successful Logistics and Supply Chain Management strategy.
(iii) Information: Process integration across the supply chain to communicate useful information such as demand signals, projections, inventory, transportation, possible cooperation, and so on.
(iv) Inventory Management: Quantity and location of inventory, including raw materials, work-in-progress (WIP), and finished goods.
(v) Cash-Flow: Creating payment conditions and techniques for transferring payments amongst supply chain participants. Managing and directing the movement of supplies, information, and cash across the supply chain is referred to as supply chain execution. The flow is bidirectional.