One of the biggest obstacles that a retailer can face is having profitability disrupted due to stock shortage. Although essential, high-volume growth brings with it, its own set of challenges. Managing products across channels, coordinating with manufacturers and suppliers, aligning delivery and inventory, handling in-store purchases to name a few! The best way to overcome the challenges posed by high-volume growth is by controlling supply chain management.
Supply chain management involves streamlining the business’s supply activities by controlling the flow of goods and services. The idea behind this is that each product procured by a consumer is a result of the efforts put in by different parts of the organization that make up a supply chain. This covers everything from product development to production to the information systems considered necessary to direct these processes.
Supply Chain Best Practices and Benefits
A supply chain can help any business stay ahead of trends and add to the company’s bottom line. Here are a few tips to help you with the strategy:
Set up Supply Chain Council:
Every business requires a clear strategy for functionality and efficiency. For the purpose, it’s important to have a set of leaders in place who can engage with the supply chain issues. Executive leadership helps improve two-way communication and remove barriers that affect businesses without a supply chain council. An effective supply chain management
- Boost customer services
- Ensure customer satisfaction
- Reduce inventory costs
- Improve process integration
- Improve a company’s financial position
- Improve quality
- Improve information flow between partners
- Reduce operating costs
Implement Effective Technology:
Technology can help improve areas that contribute to below standard results. Whether you want to better streamline your inventory or focus on software for integrating payments, identifying areas of concern is important. An ideal software solution gives you more access to data and helps strategically plan the performance, moving forward. Arming your business with a software solution lets you stay on top of sales, reporting and inventory using a consolidated platform. Better access to all the tools and insights facilitates better supply chain management and a healthier retail business in general.
The total cost of the supply chain in India is an important parameter affecting the overall revenue of the business. Inventory can be equated to money on the shelves and inventory carrying costs form a large part of the total cost. Inventory levels must be consistently reviewed to ensure it’s in sync with the business requirements. Optimal levels of inventory can be ensured by placing more emphasis on demand planning and forecasting. Analyzing your inventory data carefully enables you to make well-informed decisions related to promotions, stock ordering and staffing etc. However, having too much data can be overwhelming which is why it’s important to run the right reports such as inventory on hand report, low stock report, product performance report and sales report to track your inventory like a pro.
Streamlined Contract Management
Contracts form the most important part of a business but they are kept aside in a corner and often forgotten once the negotiations are over. By making contract management part of the supply chain, you’re making sure the contracts are collected and maintained in a central place and regularly reviewed. This way spend can be leveraged in a way that helps reduce the costs while minimizing the risks.
Supply chain management facilitates direct transfer of products from the supplier to the customer by marginal or no handling or storage.This is known as cross docking which saves both money and time on delivery and shipping, storage, labor costs. Unpreserved or temperature controlled items such as food, already packaged & sorted items benefit from through cross docking.
Every business, whether big or small can be improved to a great extent using supply chain management. An effective supply chain management can help cut down operation costs, streamline service delivery and optimize the overall organizational performance. It also gives you a competitive advantage geared towards growth.