Supply Chain Management Plan For Safeway Airways

Supply Chain Management Plan For Safeways Airways

Safeways Airways Company intends to set up a wholly owned subsidiary in Australia. Australia is popular for having a favorable environment that supports business activities. However, a company must comply with the country’s import and export regulations. For successful importation, a company must comply with the government regulations including duty taxes as well as clearance by the country’s Department of Home Affairs. A business must also obtain licensing and import permits.

For export activities, a business must have an export declaration form and a prohibited and restricted exports form from the Australian Border Force (Australian Government, 2018). The country also has an effective transport network comprising of more than 874,000 kilometers of road, at least 33,000 kilometers of heavy rail and 291 kilometers of light rail. Australia has 40 airports, including 10 international airports. Also it has 37 ports with annual throughput of at least 1 billion dollars (DIRD, 2016). However, the recent political upheaval that led to the election of Scott Morrison and brewing turmoil in the ruling coalition may be bad for business.

Scott (2018) indicates that Barnaby Joyce planned to challenge for top position in the government. Apart from the business environment, it is important to consider the logistics and supply chain management factors associated with setting up a subsidiary in Australia. Some of the hot issues worth taking into consideration are inventory and transport management, sourcing and marketing in the supply chain, green logistics and supply chain, as well as warehousing. Based on information search, Safeways should set up a subsidiary in Sydney. This is due to the fact that it the country’s only global city.

City of Sydney (2016) indicates that apart from being the leading knowledge-based economy in the country, the City of Sydney generates at least $108 billion each year. This accounts for more than 7% of the country’s economy. It also provides more than 430,000 jobs across different skills levels that offer opportunities for different people.

Paper For Above instruction

Introduction

Safeways Airways' strategic decision to establish a wholly owned subsidiary in Australia stems from the nation’s robust economic environment, sophisticated infrastructure, and strategic geographic location. However, navigating the complexities of Australia's import and export regulations, coupled with its dynamic political landscape, necessitates a comprehensive supply chain management plan. This paper evaluates key logistical factors critical to the successful setup and operation of Safeways Airways’ Australian subsidiary, with a focus on Sydney as the optimal location.

Country and City Selection Justification

Australia's export-import regulations are stringent yet well-defined, making compliance vital for smooth trade operations. The country’s extensive transport network, including roads, railways, seaports, and airports, provides multiple avenues for distribution. Considering demographic factors, workforce availability, and political stability, Sydney emerges as the optimal city for establishing the subsidiary. Sydney’s significant contribution to the national economy, coupled with its status as a global financial and logistics hub, makes it an advantageous location for managing supply chain activities.

General Logistics Impact

The Australian government’s policies facilitate international trade but require adherence to specific documentation, such as import permits, export declarations, and restricted/prohibited export forms. Transport infrastructure—over 874,000 km of roads, 33,000 km of heavy rail, and modern airports and ports—enables efficient freight movement, albeit with some challenges related to congestion and infrastructure capacity. Labor market dynamics, including skills availability and labor laws, influence operational planning. Political stability appears strong but warrants continuous monitoring due to recent upheavals affecting policy certainty.

Supply Chain Management Issues

Key issues include managing inventory levels efficiently across multiple transportation modes, sourcing reliable suppliers, and establishing contracts with third-party logistics providers. Transitioning to green logistics is imperative, aligning with sustainability goals and regulatory expectations. Warehousing strategies must leverage Sydney’s existing infrastructure while integrating advanced inventory management systems. Supply chain resilience, risk management, and adapting to fluctuating market demands are additional challenges.

Recommendations for Supply Chain Setup

Based on comprehensive assessments, Safeways Airways should establish its logistics hub in Sydney. The city’s well-developed infrastructure supports diverse transportation modes, offering redundancy and flexibility. Its proximity to suppliers, customers, and ports ensures short lead times and cost efficiencies. Additionally, Sydney’s skilled labor force and digital connectivity enhance operational capabilities, making it suitable for long-term strategic goals.

Components of the Supply Chain Management Plan

• Supply Network Nodes: Distributing centers strategically located in Sydney, with potential satellite warehouses in key regional hubs.
• Inventory Policy: Employing a just-in-time approach to reduce holding costs while maintaining safety stock levels for critical items.
• Customer Service Policy: Ensuring timely delivery and robust after-sales support to enhance customer satisfaction.
• Information Technology Capability: Implementing integrated ERP systems for real-time tracking and efficient data management.
• Supply Network Links: Utilizing multimodal transportation—air, sea, rail, and road—to optimize time and cost efficiencies.
• Cost Plan: Focusing on operational efficiencies, supplier negotiations, and transport optimization to control costs while maintaining service quality.

Conclusion

The establishment of Safeways Airways’ subsidiary in Sydney offers a strategic advantage driven by infrastructure, economic vitality, and geographic considerations. While regulatory compliance and logistics management pose challenges, these can be mitigated through meticulous planning, technology integration, and supplier partnerships. The comprehensive supply chain plan outlined ensures alignment with the company’s long-term growth objectives, leveraging Sydney’s status as a global commerce nexus.

References

• Australian Government. (2018). Importing and exporting guidelines. Retrieved from https://www.homeaffairs.gov.au
• City of Sydney. (2016). Business and economy report. Retrieved from https://www.cityofsydney.nsw.gov.au
• Department of Infrastructure and Regional Development. (2016). A dozen of facts about transport in Australia. Canberra, Australia: Bureau of Infrastructure, Transport and Regional Economics.
• Scott, J. (2018, October 18). Australia’s political stability in focus again with Joyce reports. Bloomberg. Retrieved from https://www.bloomberg.com
• Australian Bureau of Statistics. (2020). Labor market and workforce data. Retrieved from https://www.abs.gov.au
• Australian Trade and Investment Commission. (2021). Australia trade overview. Retrieved from https://www.austrade.gov.au
• Department of Foreign Affairs and Trade. (2020). Australia's trade policies. Retrieved from https://www.dfat.gov.au
• Infrastructure Australia. (2019). National infrastructure assessment. Retrieved from https://www.infrastructureaustralia.gov.au
• World Bank. (2022). Ease of doing business in Australia. Retrieved from https://www.worldbank.org
• Global Logistics Report. (2021). Major logistics hubs and infrastructure review. Retrieved from https://www.logisticsworld.com