Introduction

Kmart is one of the fast growing Australian chains of department stores maintained by the Kmart group division of Wesfarmers. It has more than 330 departmental stores in both New Zealand and Australia. The head office of the company is located in Melbourne. The company was founded in the year 1969 and prior to 2007, the company faced huge loses. In the same year, Wesfarmers tool the full control over the company. In the present time, the company is running its business in every part of Australia. Currently, it is offering different types of retail products to its customers at the reduced price than its competitors.

The main retailing products of the company are: toys, clothing, footwear, stationery products, sports products etc. Today, the stores of Kmart are known for their excellent and superior supply chain system and management. This allowed the company to increase market share, revenue and profit level. The main objective of this research paper is to analyze the supply chain management strategies, practices and method adopted by Kmart.

Kmart Supply Chain management (SCM) Model

Generally, SCM can be defined as a strategic plan of all the activities and practices performed by the company’s member to procure raw material form the suppliers to offer end products to the consumers. The company Kmart has executed specific supply chain initiatives which are used as standards practices for the cost reduction. Such effective supply chain initiatives helped the company in increasing the profit level, sales level and reducing the costs. The company is using ERP system that helps it taking all the strategic decisions about the supply chain (Alexander, Walker, & Naim, 2014).

As per this, the company has tight control over the ethical actions, merchant choice and export licensing for supplying the materials. The company has more than one thousand suppliers that play key role in supplying of different commodities to the company. The sourcing head department is accountable to maintain the relations with the suppliers. Vietnam housewares limited, Zenith baby Care Company limited, Miami fashions, IRIS fabric limited etc are the key suppliers of the company.

Supply Chain Strategy of Kmart

The company Kmart had adopted an incline supply chain method that helps in direct sourcing of materials. This is allowing the company to save time and cost. On the other hand, it should also be noted down that, the company has developed a shipping consolidation for the purpose of better transport to enhance overall efficiency. The company has standardized shipping carton size to attain efficacy in delivering of goods. The company has full control on its supply chain practices. For case, different supply chain processes and practices are controlled and managed on the regular basis in order to mitigate the SCM risks. The company follows ethical standards and norms in the context of SCM. For case, it has more sustainable SCM systems that help in attaining the business objectives (Arzu Akyuz, & Erman Erkan, 2010).

The company is closely works with its partners and suppliers under the development programs. This is helping in developing stronger relationship with the suppliers. Natural resources are used carefully to protect the natural environment. The company is also applying a number of tools and techniques for the risk measurement and controlling. For case, artificial intelligence, big data, and artificial intelligence are the key tools and technologies used by the company to deal with the supply chain risks.

Moreover, employees are considered essential part of the company so they can feel motivated, valued and esteemed. In order to retain and keep employees motivated for the long time, companionable packages are offered by the company. SCM allowed the company to adopt dynamic and complex business environment. Supply Chain Risk Management (SCRM) is all about implantation of specific standards and policies to control day to day operations related to supply chain. The company is use several risk management processes and strategies to deal with the SCM risks and issues (Hassini, Surti, & Searcy, 2012).

Supply Chain Agility, Flexibility and Responsiveness

The supply chain agility is utilized by the company in order to measure and access the ability of supply chain to react to market changes to attain competitive scope and advantages. The company is focusing on designing of their supply chain process for the business planning. For example, several business practices and strategies are modified by the company to be more competitive in the market. The company is also investing billions of Australian dollars on logistic chain in order to reduce costs and improve profitability (Ip, Chan, & Lam, 2011).

On the other hand, it is also focus on managing of tight control over merchandise allotment, ethical actions check, price citation, export licensing etc. CBX software is also utilized by the company to develop coordination among the various departments. ERP system adopted by the company is used for the sourcing unit. The main purpose of the company is to combine merchants, buyers, and departments into a single system. Moreover, different information systems and tools are also used to access the information in the meaningful manner Hove-(Sibanda, & Pooe, 2018).

Kmart is the company that strongly pays attention on SCOM (Supply Chain Organization and Management) in order to reduce costs as well as optimize product collection. The company has created a specific strong leadership strategy that is responsible to bring overall transformation in the company and supply chain process, and strategies. On the other hand, direct sourcing method is also utilized by the company in order to manage the prices of products in an effective and proper manner.

Global SCM in Kmart

The global SCM strategy ensures that consumers are able to get the right products/services at the right time and as per their needs and wants. The company deals with its customer in an improved and faster manner so needs and wants of customers can be fulfilled. Along with this, it should also be noted down that, Kmart is one of the leading retailer in the market that focusing on structuring of its supply chain with the distribution center to fulfill the demand of the consumers successfully. The growth in the retail industry created significant business opportunity for the company to leverage its economies of scale. The company is also planning to invest in new technologies, tools and procedures to be more competitive and success in the market. In the same way, it is focusing on using new tools and techniques to improve its supply chain practices (Ibrahim & Hamid, 2014).

Conclusion

Based on above analysis and discussion, it is concluded that, Kmart is one of the leading and fast growing retail company in the market that had adopted a number of specific and effective supply chain strategies, practices and process to bring innovation in its SCM practices. On the other hand, it is also found that, the company has attained supply chain efficiency via lean supply chain methods, tools, techniques, models. The company is saving different types of cost with the help of effective SCM strategies. Moreover, the company has increased its business reputation, image and goodwill in the market due to its effective and best supply chain strategies, models and methods.

References

Alexander, A., Walker, H., & Naim, M. (2014). Decision theory in sustainable supply chain management: a literature review. Supply Chain Management: An International Journal, 19(5/6), 504-522.

Arzu Akyuz, G., & Erman Erkan, T. (2010). Supply chain performance measurement: a literature review. International Journal of Production Research, 48(17), 5137-5155.

Hassini, E., Surti, C., & Searcy, C. (2012). A literature review and a case study of sustainable supply chains with a focus on metrics. International Journal of Production Economics, 140(1), 69-82.

Hove-Sibanda, P., & Pooe, R. D. (2018). Enhancing supply chain performance through supply chain practices. Journal of Transport and Supply Chain Management, 12(1), 1-13.

Ibrahim, S. B., & Hamid, A. A. (2014). Supply chain management practices and supply chain performance effectiveness. International Journal of Science and Research, 3(8), 187-195.

Ip, W. H., Chan, S. L., & Lam, C. Y. (2011). Modeling supply chain performance and stability. Industrial Management & Data Systems, 111(8), 1332-1354.