In today’s competitive world, supply chain management is one of the decisive elements that determine the sustainability of a business. An organization’s supply chain strategy depends on many factors that can be internal to the company or can be governed by the market conditions or the government policies. One of the factors that impact supply chain management is the tax or the fiscal costs.
Supply Chain Management (SCM) is the dynamic simplifying of a business’ supply-side activities to maximize customer value and to gain a competitive advantage in the marketplace. Supply Chain Management epitomizes an attempt by suppliers to develop and implement supply chains that are as efficient and economical as possible.
Supply chain strategies are the essential backbone of business organizations today. Every business has a standard for inventory turnaround that is in place to ensure optimum profit for the business. Any loss of inventory anywhere in the supply chain will result in the loss of value. Effective control of inventory and inventory visibility acquire prominence as key factors within the Supply Chain Management process.
The structure of the supply chain is significantly influenced by different taxes based on the location of the business. By eliminating multiple state taxes, the logistics companies can consolidate their warehouses instead of maintaining one in each state to avoid central tax.
The cost savings by the companies as a result of the GST can be used for further investment to advance serviceability. After the implementation of GST, the design of the supply chain will be based on customer service and logistics cost. The GST will assist firms in increasing the accuracy of their forecasts.
Post implementation of the GST, following are the benefits that will be relished by companies in the supply chain management mechanism:
On the whole, the supply chain management industry will require to gear up to get the most out of the GST environment.
Every member of the supply chain must rise to the challenge and take up their roles. Ample preparation, an entrepreneurial attitude, and overcoming challenges will be essential to a successful transformation. In the long run, India’s supply chain industry can witness several interesting trends in the post-GST world. With the GST triggering a wave of new trends and an overall lift for supply chain players in India, the industry is bound to improve its overall competitiveness on an international scale.