This article discusses how Small to Medium Enterprises (SMEs) apply information systems (IS) to facilitate decisions concerning their supply chains. In the collective decision—making environment of the Supply Chain, SMEs have to strike a balance between inventory reduction to minimise working capital costs and maintaining sufficient inventory to cater for demand fluctuation. These decisions take on an additional level of complexity for food SMEs, where the products have finite shelf lives and are subject to strict traceability requirements. Nevertheless, some of the smaller SMEs have proven successful in using IS to facilitate critical decisions to minimise inventory and therefore operating costs, while still retaining the ability to cope with demand fluctuation.
Key Terms in this Chapter
Small to Medium Enterprise (SME): In European terms, an enterprise which employs fewer than 250 persons and which has an annual turnover not exceeding €50 million, and/or an annual balance sheet total not exceeding €43 million.
Supply Chain: A network of distinct organisations acting together in a coordinated fashion to transform inputs from original suppliers into finished products and services for end consumers.
Supply Chain Integration: A synchronisation and coordination process that facilitates process alignment and information flow across all organisations in a supply chain, with the ultimate goal of reducing cost and improving customer service.
Supply Chain Management (SCM): The planning, organisation, coordination, and control of all supply chain activities through the cooperation of all organisations in the supply chain, with the ultimate goal of maximising the competitive advantage of the supply chain.