When it comes to growing your business, supply chains need additional levels of attention because if your business grows too quickly and your supply chain or logistics cannot keep up then you’re headed for trouble. Within this blog post we will examine our tips for smooth supply chain management and things to consider when looking to grow your business.
1. Have a risk management plan
The past year has highlighted the importance of having a risk management plan in place, regardless of whether your supply chain is large or small. Many businesses are still experiencing supply chain issues because of the Covid-19 pandemic which has had disastrous consequences for their businesses. A risk management plan identifies potential risks, how they could affect your supply chain and what you would do within that situation.
2. Choose your suppliers wisely
When it comes to selecting suppliers, cost isn’t everything, and it pays dividends to have a supplier who is reliable, trustworthy and has high standards of quality because this will help you to deliver the best service to your customers.
3. Good supplier relationships are essential
A good relationship with your suppliers is crucial to a smooth supply chain and gives you more negotiation to better rates and delivery times. It can also help to minimise logistical issues – if your suppliers experience issues sourcing products or parts then you need to know about it so clear lines of communication are vital.
4. Have more than one supplier per product
As the saying goes “don’t put all your eggs in one basket” and ensure you have more than one supplier for your products, particularly your best sellers. Unforeseen issues can arise at any point such as floods or fires, and this way you’ll be prepared with a back-up.
5. Invest in ERP solution
Research by Gartner has revealed that only 47% of businesses use Supply Chain Management technology horizontally across their business functions. However, investing in a robust ERP solution, and benefiting from the level of visibility provided, is essential to any business looking to grow. A SCM system allows you to combine your purchasing, stock, sales and financial management so you know the exact value and location of your stock, how much is needed, the profit margins made and helps you know when to order more.
6. Use demand planning
Utilising historical sales information can improve the effectiveness of your supply chain because you can plan when you will need more of a particular product and ensure your supplier will have plenty of notice so you can meet demand.
7. Quality control
If there is one thing you should never cut corners on, it’s quality control. You should check, double check, and check again all incoming stock to ensure it’s of the expected quality because if inventory is not up to scratch then that could be detrimental to your reputation.
8. Hire more help
Supply chains are busy, and you need all hands-on deck to successfully manage a hectic warehouse and distribution smoothly. Consider your resources and whether you need to hire more help during busy or seasonal periods so you can meet demand.
9. Consider third party logistics (3PL)
In busy periods your growth might be held back by insufficient storage in your warehouse or you might be limited by logistics. Third party logistics is a consideration whereby you outsource your storage or logistics to a third party so you can continue to grow your business.
10. Keep reviewing your processes
Just because something works today, doesn’t mean it will work tomorrow so it is vital that you regularly review your processes so you can quickly identify areas where efficiency could be made or identify problems that are occurring. For example, have you noticed that quality is slipping from a particular supplier, or perhaps you’ve noticed an upturn in late shipments?
Any business looking to grow will have to pay additional attention to their supply chain to ensure it can keep up with increased demand and is running efficiently. Choosing your suppliers wisely and maintaining a good relationship with them is vital, as is investing in an ERP solution to give you greater visibility across your entire business. It’s also important to regularly review and plan for unforeseen circumstances to proactively avoid delays or disruptions.
For more information about supply chain management then please get in touch with our friendly team.