Supply chain is a network system formed between enterprises on the basis of contract (contract) relationship, which is different from the contractual relationship established between enterprises before the 1990s. Since the Commodity Exchange relationship between enterprises, the contract must exist. Why the relationship after the 1990s is called the supply chain network relationship is because the essential characteristics of the supply chain are different. There are five essential characteristics of supply chain management, namely core enterprises

Coreenterprise. Outsourcing, Contract, Dynamics and Strategic.

Characteristics of supply chain management - core enterprise, outsourcing, contract

The first feature of the supply chain is the core enterprise. A core enterprise is an enterprise that only focuses on its core business and transfers non-core business to other enterprises through outsourcing. Therefore, outsourcing is the second feature of the supply chain. The third feature of supply chain is contract (contract). That is to say, the outsourcing of core enterprises is realized by contract, which fully guarantees the flexibility of outsourcing.

What needs to be noted is whether only strong enterprises can become the core enterprises? The answer is clearly no. The criterion to judge the core enterprise is not the strength of the enterprise, but how to view what is the core business of the enterprise.

Obviously, the core business of the enterprise is determined by the enterprise itself, not by other enterprises. In other words, enterprises outsource the unimportant business. Whether it is important or not is determined by the enterprises themselves. Therefore, any enterprise can become a core enterprise as long as the non-core business is outsourced, which has little to do with the size and strength of the enterprise.

Apart from running their own core business, what are the characteristics of a core enterprise? In fact, the core enterprise can be on the supply chain network

Other enterprises in the network to control, planning, scheduling, performance assessment and incentive and other series of operations. So why would a weak firm exercise such a right over a strong firm is determined by contractual relationships. As long as a contract is signed between enterprises, they have mutual control regardless of their strength, because contracts are equal before the law. We have made two points clear: first, what kind of enterprises can become the core enterprises; Second, the core enterprise can control other enterprises. On the other hand, other companies can also control the core company.

- There is only one core enterprise in a supply chain network. Because the supply chain network is viewed from the point of view of the core enterprise, it is actually the supply chain network of the core enterprise. If we look from the perspective of other members in the supply chain network, this member becomes the core enterprise, but its supply chain network is different from the supply chain network described above. Therefore, there can only be one core enterprise in a supply chain network, and a core enterprise must also have its unique supply chain network corresponding.

Characteristics of supply chain Management -- Dynamic

By analyzing the product structure of an intelligent toy manufacturing enterprise, we can understand this feature deeply. The toy produced by Enterprise A has the material of simulated animal fur on the outside, and the inside of the fur is the mechanical structure, movement, control and other systems. The intelligent simulation toy is shown in the figure below. A is only responsible for product development, design, final assembly and sales, while outsourcing all production processes. The supply chain network drawn according to the relationship between parts and semi-finished products.