Regardless of what type of business you are in, your supply chain is crucial to the smooth running of your business. Making sure you optimise it is key to saving time, keeping costs down and keeping customers happy.
There are a number of things to think about, such as production lead times, customer satisfaction and how your supply chain management is affecting your cash flow. Ask yourself: is there any way I can improve the running of my supply chain for my business?
Here are three top tips to optimise your supply chain.
1. Consider where your suppliers and customers are
Map out where your suppliers and your customers are to get a better idea about cost and lead times. If your customers are on the other side of the world and you're delivering a physical product, it's going to take longer to get things to them. Similarly, if your suppliers are abroad then delivery times could be lengthened, which could extend the amount of time it takes for your product to get to your customer. What's more, the location of your suppliers and customers will affect delivery costs to you.
2. Find areas to cut costs
If delivery costs are high, it might make sense to switch to a more local supplier. Do this with care as you do not want to ruin business relationships by chopping and changing. Add up how much you spend on your current suppliers, including the costs of their products plus delivery, then compare this with how much you would spend on a prospective supplier. Also consider the service new suppliers can give you; don't cut quality for the sake of cost as this could affect your end product and, ultimately, customer satisfaction.
3. Create a strategy
With the information you have about your supply chain, formulate a strategy with clear goals for areas needing improvement. Could you reduce delivery times to customers? Are there ways you can reduce costs without adversely affecting delivery times? How do you get a balance between the two? Will making changes allow you to raise the price of your end product and can you guarantee sales? Be sure to communicate your strategy with suppliers and the reasoning behind it so you can work together towards common goals.
These are just a few of the simple ways you can adjust your supply chain to get more back out of it. If you would like to talk more in depth about how you can improve your supply chain, get in touch with our team. We are happy to discuss your ideas and help you make the best choices for your business.