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Supply Chain Design and Analysis for Top Glove's Rubber Gloves
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Executive Summary

This report provides a detailed report on the supply chain design of Top Glove's rubber gloves,
both upstream and downstream. The supply chain is extended from sourcing raw materials to the
final distribution, including relevant factors like material flow, information flow, and financial
flow. Three key issues that are affecting the supply chain are outlined in the report, including the
COVID-19 pandemic, climate change, and supply chain challenges, especially in the
environment of altered demands worldwide. These problems encroach on activities and
production processes as well as efficiency in the distribution aspect. Some of the remedies have
been postulated in the report including a plurality of supplies, investing in the digitalization of
the supply chain visibility, and enhancing the sustainability efforts. The capacity to become a
stronger and a stable company which will not only end up being a larger corporation, but also
one whose operations are stable regardless of the strains met will be achieved when Top Glove
embraces these suggestions.
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Table of Contents
Executive Summary.........................................................................................................................2

1. Introduction..............................................................................................................................4

2. Upstream and Downstream activities......................................................................................4

3. Materials, Information, and Financial Flows...........................................................................4

4. Supply Chain Map...................................................................................................................5

4.1. Tier 1 - Raw Materials Suppliers.....................................................................................5

4.2. Tier 2- Manufacturing Facilities......................................................................................5

4.3. Tier 3 - Distribution Centers (Domestic).........................................................................6

4.4. Tier 4 - Customers (Domestic Sales)...............................................................................6

5. Challenges in the Supply Chain...............................................................................................6

5.1. Pandemic-related Disruptions..........................................................................................6

5.2. Supply Chain Disruptions................................................................................................6

5.3. Environmental Impacts and Climate Change..................................................................6

6. Conclusion...............................................................................................................................7

References........................................................................................................................................8
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1. Introduction

Top Glove is a rubbing glove manufacturing giant, and it is a leader in the manufacturing of
gloves in the world. Supply chain management became significant to the success of the company
due to the demand surge which was triggered by the COVID-19 pandemic (Wu et al., 2020). This
report focuses on the supply chain design of Top Glove which includes upstream that involves
supplying and production of raw materials, manufacturing process and also down stream that
involves distribution. The first causes described in the report include the impact of the pandemic,
climate changes, and unstable global supply chains. The report also contains recommendations
on what can be done to make the operation more efficient, resilient, sustainable, to ensure that it
will be growing and such demands will be fulfilled by the company in the future.

2. Upstream and Downstream activities

In Top Glove, the supply chain operations start with upstream activities, i.e., raw material
sourcing, primarily natural rubber needed to manufacture rubber gloves. The company obtains
rubber from domestic suppliers in Malaysia and other countries such as Thailand and Indonesia.
Furthermore, its chemicals and packages are obtained internationally (Mui et al., 2021). After
they are established, they are shipped to the manufacturing plants of Top Gloves located in
Malaysia, where the gloves are made. Its production consists of dipping the rubber in the molds,
vulcanizing the rubber to increase durability, and packing the final products.

Downstream activities include the distribution and delivery of the finished gloves. Top Glove has
supplied rubber gloves to industries, medical suppliers, and hospitals in Malaysia, where it
conforms with local regulations (Yip and Cacioli, 2002). The company sells gloves
internationally through exportations into the United States, Europe, etc. This is done by ensuring
distribution in terms of logistical arrangements with partners to do warehousing and
transportation, direct selling to customers, and through e-commerce to deliver effectively to a
global customer base.

3. Materials, Information, and Financial Flows

In the Top Glove supply chain, the movement of materials starts with material procurement,
which involves purchasing raw materials, including natural rubber, chemicals, and packaging
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parts. This company obtains these materials in both international markets and local markets, and
the delivery is being made to assembly manufactories in Malaysia (Wells et al., 2010). After the
materials are supplied, they are processed through dipping, vulcanization, and changing and
arranged to be packaged and shipped.

Information flow ensures synchronization in raw material supplies, manufacturing, and dispersal.
Centralization enables tracing in real-time inventory, production, and the progress of orders. As a
case in point, once an order is registered, the software initiates the production and shipment
schedule. Inventory information is invoked to ensure the continuity of stocks and avoid
derailments. The synergies of financially related flows imply transactions between Top Glove,
suppliers, and consumers (Hutchinson and Bhattacharya, 2020). The payment terms with
suppliers are negotiated, and monetary transactions are made using wires and letters of credit.
Invoices are used to manage customers' payments and to ensure higher liquidity and continuous
supply chain flows.

4. Supply Chain Map

4.1. Tier 1 - Raw Materials Suppliers

The first-level suppliers include suppliers of natural rubber, chemicals, and packaging (Loh and
Zhee, 2017). These suppliers are native (Malaysia) and international (e.g., Thailand, Indonesia).
Input materials enter the manufacturing plants of Top Glove located in Malaysia through
suppliers.

4.2. Tier 2- Manufacturing Facilities

Raw materials used in the process are put together in the manufacturing plant of Top Glove
located in Malaysia to make ready rubber gloves. The manufacturing involves dipping,
vulcanization, and rubber packaging (Mok, 2021). The production, quality control, and inventory
are monitored through information the manufacturing system receives. Financial transactions
will also be made when Top Glove pays its suppliers regarding raw materials and other
components.
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4.3. Tier 3 - Distribution Centers (Domestic)

A finished pair of gloves is then exported to Malaysian distribution centers. In these centers, the
finishes are kept and made ready to be transported to the locals. The flow of information occurs
with the inventory management systems to attain proper stock and accurate order filling (Mok,
2021). Innovation also comes in dealing with financial transactions through invoicing to
customers.

4.4. Tier 4 - Customers (Domestic Sales)

The last level involves customers in Malaysia, such as hospitals and medical suppliers; the
distribution channel ensures that gloves are delivered on time and that the customers are supplied
with information about the tracking of the order (Mok, 2021). Financial transactions are done
when the payments are realized on the products sold.

5. Challenges in the Supply Chain

5.1. Pandemic-related Disruptions

The COVID-19 pandemic generated an inordinate demand for rubber gloves globally; this was
exerting so much stress on the supply chain of Top Glove. The company also encountered cash
flow difficulties in meeting the consistent supply of raw materials because of lockdowns, factory
shutdowns, and the workforce shortage (Wahid, 1998). Such interruptions led to overdue
production and longer lead times, which in turn affected the level of customer satisfaction.

5.2. Supply Chain Disruptions

Top Glove's global supply is affected by geopolitical transportation bottlenecks and changes in
freight rates. For example, the stoppage of international shipping channels and the lack of
containers have delayed material purchases and product delivery (Caeiro-Rodríguez et al., 2021).
They not only cut upon the prompt delivery of orders but also cause logistics costs, which are
more challenging to balance, so as not to lose profit margins.

5.3. Environmental Impacts and Climate Change

Climate change directly affects the rubber industry because natural rubber is affected by extreme
weather conditions such as floods and droughts. Rubber plantations may be destroyed by adverse
weather conditions, which cause the reduction of the supply amounts and the increased cost of
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raw materials (Jirasukprasert et al., 2014). Ignoring the environmental issues may impact the
brand name of the business as well as customer loyalty, given the increased concern regarding
corporate social responsibility.

6. Conclusion

To sum up, effective supply chain management is instrumental in the success of the rubber
gloves manufacturing of the Top Glove Company. Looking at upstream / downstream activities,
material and information flow and financial stream, the complexity and interdependencies of the
supply chain can be easily determined. The pandemic disruption, the global supply chains
interruption and environment impacts, such as climate change, are three of the essential
challenges, that generate impacts on operations, increased expenses, and customer satisfaction.
The document has identified some of the strategies that should be used in addressing such
challenges such as creating diversity of suppliers/sourcing, investing in visibility of your digital
supply chain, and exercising more sustainable activities. The solutions will help Top Glove
operate in a more resilient manner, reduce the risks, and maintain competitive position in a
worldwide market. Smart supply chain constitutes a very crucial element of businesses and
survival in the modern-day highly competitive business environment.
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References

Caeiro-Rodríguez, M., Otero-González, I., Mikic-Fonte, F. A., & Llamas-Nistal, M. (2021). A

Hutchinson, F., & Bhattacharya, P. (2020, December 4). Malaysia’s Rubber Glove Industry - A
Silver Lining Amidst Dark Clouds. https://www.researchgate.net/profile/Pritish-
Bhattacharya-2/publication/372686167_Malaysia

Jirasukprasert, P., Arturo Garza-Reyes, J., Kumar, V., & K. Lim, M. (2014). A Six Sigma and
DMAIC application for the reduction of defects in a rubber gloves manufacturing
process. International Journal of Lean Six Sigma, 5(1), 2–21.
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Loh, C., & Zhee. (2017). Specific risk factors and macroeconomic factor on profitability
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Gloves Berhad (CGB). International Business Research, 14(10), 105–114.
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Wahid, Z. (1998). Potential for process improvement of the rubber glove manufacturing
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Wells, R., Hunt, S., Hurley, K., & Rosati, P. M. (2010). Laboratory assessment of the effect of
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Wu, M. Z. Y., Kee, D. M. H., Loo, Y. K., Goh, S. J., & Alyanbaawi, H. J. (2020). Increase
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