Your supply chain is your company’s lifeline. If a significant (or even minor) disruption occurs along the way, things can come to a screeching halt, a scenario you work to avoid daily. To run and grow your business, it’s necessary to have a clear and concise grip on every aspect of it, and your supply chain is one of the most important. Like every other part of your business, your supply chain logistics can experience hiccups, but there is always a solution. These include:
1. Costs
Problem: Of all the concerns that brands face in the supply chain arena, controlling costs is most important. Political events, even those in far-away nations, can have a devastating effect on your bottom line. The price of raw material, labor, and energy can all change in a heartbeat. Even the fluctuating price of oil can have a significant effect on global supply chain management.
Solution: Of course, closely monitoring your business and overall world events is an essential step in planning costs. But you have no control over world affairs. So, increasing your warehouse management efficiency by outsourcing to a trusted 3PL provider can help you level up. The expense of utilizing warehouse space (whether you buy or lease), plus all the associated fixed costs (including equipment, warehouse management software and hardware, insurance, taxes, and utilities, among others), can be overwhelming. So, let a third-party provider help.
2. Unforeseen Delays in Shipment
Issue: No matter what industry you’re in, there is always the procurement of supplies, materials, or inventory. Even though technology has made shipping and logistics more timely and easier to predict than ever before, unexpected changes around the globe (the pandemic, tariffs, weather) can disrupt your inventory lifeline, and as a consequence, affect your overall business.
Solution: Plan on maintaining a buffer stock of essential popular items. This is another benefit of partnering with a 3PL because we can assure you have a cushion supply of vital components that your brand requires.
3. Customer Satisfaction
Issue: In the end, it’s all about meeting the needs of your customers. Your customers rely on your supply chain to get your product from here to there, on time and within budget. The speed at which products are delivered has increased dramatically in recent times, and that trend doesn’t look like it’s going to change anytime soon. A large part of your reputation and overall market goodwill depends on your logistics and supply chain for promptly getting your products into their hands.
Solution: Similar to costs, constant monitoring of your operations is the best way to tackle this issue. Whether investing in new technology, boosting warehouse efficiency, or specific outsourcing tasks related to your supply chain, it’s necessary to strive to maintain sublime customer service. Staying on top of this will ultimately pay dividends for your business financially and in customer goodwill.
4. Risk Management
Issue: Risks in the business world are common, and knowing how to deal with them is key to success. Because suppliers, manufacturers, clients, and customers are often situated in different parts of the globe, there’s a lot that can go wrong. And the more factors that are at play here, the risk there is. If one component fails or has some issue, it could be a house of cards disrupting your entire supply chain.
Solution: Knowing what to look for – namely, having a grip on the key factors that impact your business and planning when each piece falls out of line is vital. Contingency planning is a must! A strong 3PL partner who is skilled in this area will carry that load and allow you to put your time and energy into other areas of your business.
5. Hiring & Retaining Qualified Employees
Issue: Finding (and retaining) talent in virtually every business can be challenging, and the warehouse space has an extremely high turnover rate. A 2019 study by IARW found the average turnover rate was 32.5%, far higher than America’s average overall turnover rate (22%).
Solution: Employing an experienced third-party logistics firm is vital for your company to remain competitive in this challenging business environment. A 3PL can expertly handle all of the issues you aren’t as specialized in yourself, such as hiring (and retaining) qualified warehouse personnel.
Taylored Services, an experienced 3PL partner, is a fully integrated third-party logistics provider specializing in wholesale, retail, and direct-to-consumer unit fulfillment that can help. Learn more about our innovative solutions today.
Chris Capelle is a technology expert, writer, and instructor. For over 25 years, he has worked in the publishing, advertising, and consumer products industries.
References:
Supply Chain Beyond – Joe Bellini discusses some of the factors driving the trends documented in 2021 Supply Chain Trends
Wisconsin School of Business – Challenges in Supply Chain Management
Forbes – 3 Common Supply Chain Weaknesses and Strategies to Overcome Them
