Operation is the process of transforming input into ouputs such as goods and services. Operation management thus deals with operation srategyies and finding the most feasible option. This is an important part of business that helps to organize inventory and thus minimizes number of turnovers. The key to determine the amount supply required is through capacity of the business itself as well as factual measurements of the market. There are many variabilities in a market caused by the fluctuated economy and such. Due to this, lots of scheduling and planings must be done in deciding the right amount of inventory. After all, inventory does not generate any profits in storage. Rather, it carries a cost for taking up the available capacity of a company.
In deciding supply managment, one must also consider the way of spplying the products. These methods include selling through supply chain or direct business model. Supply chain allow inventory to flow in and out faster since it’s flowing from manufacturere, wholesalers, retailers and then consumers. Direct business model may be at disadvantage since it requires the company to store product and take up capacity. However, direct sell is better in that it provides direct interaction with the consumers.