Supply Chain
When you increase supply chain efficiency, you subsequently improve business relations and costs. In many cases, one may use existing resources to maximize supply chain utilization, delivering products to the end-user with minimal delay and affordability.
Luckily, there are many ways to improve supply chain efficiency. Businesses can scale their actions successfully while enhancing the user experience when implemented. Here are some ideas on how to do that.
Select the Right Suppliers and Facilities
It can be difficult to get a handle on partners who will be best suited to your business, so in this situation it can be beneficial to work closely with industry experts in Logistics and supply chain networks. Utilising the services of these experts can help you to find optimal solutions and partnerships which will improve your business efficiency.
Consider a Third-Party Logistics Company
A third party logistics company can handle inventory control, storage, packaging, shipping, and delivery arrangements. Though specific services vary depending on the company, many third-party partners act like your one-stop shop for supply chain management. They are experts at creating and managing an efficient supply chain.
Automate Supply Chain Processes
There is intelligent supply chain software, AI supply chain software, and automated data collection that makes monitoring your supply chain easier. See real-time updates, easy-to-interpret data, and data automatically collected at every stop in the supply chain.
There is no work beyond getting the software installed. Supply chain automation applies to inventory management, managing suppliers and facilities, route optimization, forecasting demand, and more.
Identify Your Supply Chain KPIs
Several supply chain KPIs, or key performance indicators, will help you determine how efficient your system is. For example, the Supply Chain Inventory Turns measures how quickly inventory goes through your supply chain system and compares it to industry standards. Supplier Performance Index, or SPI, measures supplier performance in lead time, quality, cost, delivery, reliability, service level agreements, and customer satisfaction.
Throughput is the number of units that move through your supply chain system within a specified period, which can be set as little as hours or as long as a year. Time is another critical metric that will help identify on-time deliveries and receipts, the time it takes to process an order, and order fulfillment times.
Lower Inventory & Supply Chain Costs
Look for opportunities to reduce supply chain expenses. For some, switching to a third-party logistics company with its own inventory control and warehousing can reduce supply chain costs. For businesses that want to manage everything, look at the where, when, how, and why.
Having too much inventory is bad, just like a business having too little. Consider whether your inventory is helping or hurting and make adjustments from there to the quantity, what it is, and how it’s stored. You may also want to reduce inventory control or warehousing costs by moving parts of your supply chain to other locations.
Forecast Demand for Your Products
Many products have seasonal highs and lows. The holiday season is a big time of year for many products, outlining when you know demand will be higher, and your supply chain will have to be more robust to fulfill orders.
Address Delays in Delivery and Shipping
If costs are increasing, and delays are routine, tackle it head-on. Unless you’re leaving it in the hands of a third-party logistics company, it is up to you to identify why shipping delays are happening and resolve them.
At some point, delays, interruptions, and risks will present themselves in or around your supply chain. A business can mitigate all of this by creating a plan that can be put into action during times of emergency. It can also anticipate disruptions as they arrive.
Increase Collaborative Efforts
With all stakeholders in the supply chain, ensure communication lines are open, and there is collaboration. If there is a weak link, work with them to improve or replace it. Encourage innovation among collaborators and make recommendations if you believe they can further optimize your supply chain.
Examine Route Optimization & Visibility
If you deliver country-wide or globally, you may discover significantly better shipping rates and times by optimizing your route. After a business has been involved in shipping and delivery for a while, it will become more skilled at identifying route optimization opportunities. Collaborators or working with a third-party logistics service may also be able to recommend the best shipping route for your needs.
When you increase supply chain visibility, studies show that this improves overall performance. Products are more likely to be delivered on time, quality standards more likely to be adhered to, and production processes become more efficient.
