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Today's Supply Chain


Supply chain problems are taking place around the world. Ships are stuck in port while raw materials go undelivered. Orders back up as businesses and consumers wait. Many supply chain issues seem to be caused by the pandemic. However, government responses have caused as many problems as they have solved. Are current supply chain issues permanent?

The fundamentals of a robust supply chain have not changed. Supply chains incorporate ordering, shipping, manufacturing, distribution or sales, and demand. Address each of these steps to bolster your supply chain.

Ordering has several areas that need tending. The timing of your orders must meet your need. The timing of your order will determine if your product is available on time. Your resources may be committed to inventory if you order too early. To place precise orders, you must have some idea of the demand there is for your product. Calculating demand requires skill usually derived from experience. Does it make sense to split orders between different vendors? The addition of an alternate vendor may provide a fallback if one fails to deliver.

Shipping impacts us all. Large corporations have dedicated shipping departments to reduce costs and assure delivery. Carrier reliability, delays, and cost each play a part in developing a stable shipping strategy. Whether incoming or outgoing, shipping plays a crucial role in every business. Splitting shipping among multiple carriers is a popular way to avoid problems if one shipper has complications. Comparing the cost of reliable carriers is another widely used strategy. Many delays are unavoidable, but choosing a shipper that reduces delays may be vital.

Large companies split logistic issues into departments. Small companies must manage everything from shipping to delivery themselves. Manufacturing requires the management of both raw materials and personnel. Inventory and sales are tied together; monitoring sales helps manage inventory. Streamlining the manufacturing process may save the money necessary to offset higher costs.

Assessing demand is crucial to meet delivery, establishing promotions, controlling orders, and managing the manufacturing process. Projecting sales is more of an art than a science. Economic trends, market direction, and experience all take part in making qualified assessments.

Changing government policies makes it difficult for companies to plan with confidence. Ronald Reagan once said, "The nine most terrifying words in the English language are: I'm from the Government, and I'm here to help." Regulations strangle some industries and force them to spend resources on imaginary problems. Scott Rigell, a businessman and former politician once said, “Have the government get out of the way.” Avoiding government hurdles can free up time and resources.

Researching and developing alternate supply streams and managing expenses can alleviate many of today's supply chain issues.

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