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How Does a Supply Chain Work?

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The diagram below shows a basic supply chain for manufacturing a CAR.

General Supply Chain

AA = steel, BB = plastic, CC = rubber, DD = car

  1. Raw materials - The steel , plastic and rubber are turned into the car body (A), the dashboard and other interior car parts (B) and the tires (C)
  2. Production- The car parts go to the main factory where they are assembled into a car (D)
  3. Distribution - The cars are transported to a dealership/store via truck or train
  4. Customer - When you, the customer, go into the dealership to buy the car, the supply chain is complete.

The flow of information is important so that there are no delays in producing the car or in having cars at the storefront to sell to customers.