Supply chain management is a crucial piece of a business’ success. An effective supply chain is important for various industries including manufacturing, retail, and logistics. When it is well managed, it ensures that goods and services are delivered to customers in a timely and cost-effective manner. It also helps a business to keep a good track of inventory and reduce risk. Ultimately, an effective supply chain can enhance a company’s profitability and competitiveness. This is done by providing a seamless and reliable flow of products and services to its customers.
How Should You Be Thinking About Your Supply Chain?
Since your company’s supply chain is so valuable to your business, it is very important to think about how you can improve it. One great way to do this is by looking at it with a different perspective than in the past. Sometimes that means that even past successes or failures may not be true today. When it is well thought out, your business reduce costs and increase profitability. One important thing is to monitor success along the way.
It is important to keep your supply chain diversified. If you are a more product driven business, then you should seek to diversify where your products or inventory are coming from. If you are a more service driven business, then you should be looking to diversify where your resources (time and people) come from. When you can create a diversified supply chain, you then have the advantage when it comes to cost and efficiency.
Not Always Financial.
When you are monitoring success, it is important to realize that it does not only mean financial success. If the inventory cycle of your business takes three months, from ordering the product to receiving payment from the customer. Then it would be ideal to look at each month in the process and determine its success. One way this can be done is by picking a metric and measuring it each month. By doing this you can determine if it is working well. This can be things like how long it takes to get the product. Or how long it sits on the shelf. This doesn’t always have to be a financial metric.
The supply chain has such a large impact on the success of the business, so it is always important to think about it very carefully. Overall, monitoring your supply chain can ensure it is set up to work as effectively as possible. If you have any questions or need help with your financials, click the link below or give us a call today.