Businesses are involved in the production and distribution of one or more goods and services. This process is the chain of production in which there are primary business activities and secondary, or support, activities. The primary activities focus on developing products, distributing them and offering after-sale services on these products. Generally these activities include inbound and outbound activities, operations, marketing and sales and after-service activities.
Inbound logistics is the initial primary business activity. It is the interaction that the business has with suppliers who provide incoming goods such as food for a hotel, or automobile parts for a car manufacturing company. Value is added here as a business receives the inputs and stores or distributes them.
The operations activities include the processing of materials to a form that is consumable. Value is added here as a good is processed or manufactured. For example, the raw food products received by a hotel are prepared for consumption by the hotel guests. Or car parts are assembled together to produce a whole vehicle ready to be distributed to retailers.
Outbound logistics are the activities that prepare the final product for distribution. These include packing books, video games, vehicles or food, storing them and shipping them off to their various destinations. Value is added to the products through preservation in the food that has been well packed and stored, or the prompt and reliable delivery in the case of video games and books.
Marketing and Sales
Marketing and sales activities focus on making consumers aware of products and services in the market. Activities involve marketing campaigns, advertisement, promotions and strategies to increase sales such as facilitating online buying.
After-sales services are those activities that involve interacting with the customer to provide him appropriate assistance after purchase. For example installing an alarm system for a customer, providing him with maintenance services, handling his queries and complaints and managing the responses. These activities can be used to improve the various stages of chain production such as operations and marketing.