Supply Chain Optimization Study For Yulong Mountain Spring Plant

Yulong Mountain Spring Plant is a small local factory that producing drinking water.It is weak in capital,technology and management.Yulong Mountain Spring Plant experienced consecutive losses in the early years and is facing to bankruptcy because of poor supply chain management during the new business of exported bottled water.The article is to analyze the supply chain management problems of Yulong Mountain Spring Plant under the guidance of supply chain management theories.The problem is found out that the sales gross profit is too low by comparing the sales gross profit,operating expenses,management fees and finance charges with drinking water industry.The root causes are found out to be the material is too expensive,the material scrap is too much and the logistics cost is too high through cost break down.Then 3 measures according to the 3 root causes are proposed which are decreasing the material cost,controlling the material scrap and reducing the logistics cost.Decrease the material cost by introducing new suppliers,reducing supplier's purchasing cost and reducing supplier's manufacturing cost.Control the material scrap by solving the leaking and scratch problems.Reduce the logistics cost by changing the logistics method and optimizing the logistics.After optimization of supply chain,Yulong Mountain Spring Plant profits and gets rid of the trouble.The research result concludes that the effective supply chain management is an important way to reduce the costs,meet customers' demand and improve the core competitiveness.The research results of the article are of great guiding significance for supply chain management and optimization of domestic small and medium-sized enterprise.