Getting your supply chain to run like a well-oiled machine means putting products on the market faster, increasing full-price sales and increasing your profit margins.
It’s not all about cutting costs. Doing things that enhance productivity and increase logistics efficiency at all levels of the supply chain go a long way in improving your income statements.
Efficient supply chain management deals with streamlining the logistics involved from a product’s point of origin to its point of consumption.
In this article, we’ll look at four ways you can generate savings by improving the logistical process of your products.
1. Prioritize Inventory Tracking
One of the largest causes of dips in productivity are traditional methods that leave too much room for human error.
When the numbers in your software don’t match your physical inventory count, the lack of accuracy leads to “unexplained” inventory losses that hurt your bottom line.
Prioritizing inventory tracking means investing in top-of-the-line technology, which replaces hand-checked lists and spreadsheets.
The automating high-tech inventory management systems provide saves you money by reducing employee hours and human error.
Your system can automatically alert you when there’s a stock shortage and place a new order on its own so that there’s never too little or too much stock. It’s also easier to scale your business when tracking your inventory is easy, accurate and time-saving.
2. Only Work With Vendors Who Can Keep Up
Be sure to work only with vendors who are able to provide the materials you need when you need them, to reduce waste and supply costs.
For example, Apple Rubber, which supplies manufacturers with rubber seals, has a simple and streamlined process from placing an order to receiving your shipment.
Avoid vendors with fees for order corrections and other necessary processes. Monitor vendor performance with metrics to ensure your standards are met.
3. Collect and Analyze Data
Besides collecting data that monitors vendor performance, collect data wherever possible throughout the supply chain so you can find out where savings are lost and improvements can be made.
What you thought was a cost-cutting practice could end up costing more in the long run, but you wouldn’t know without being able to analyze the data.
Collect data on errors as well so you can find the biggest sources for error in the supply chain and prevent time-wasting and money-draining mistakes.
4. Consider Block Chain
Using blockchain technology across the entire supply chain provides a digital ledger for transactions, which saves money by improving productivity and accuracy.
Blockchain can provide more measurements throughout the supply chain, such as how many products are delivered, where they’re delivered and at what time.
This information, which is gathered free of human error, can help you find ways to save costs and optimize your pipeline. It’s a transparent, real-time public record of any and all types of transactions, so it ensures suppliers, vendors and employees are all on the same page in the manufacturing process.
There are tons of hidden savings it can generate, as it reduces errors by making them visible.
How You Can Win With Leaner Logistics
Don’t underestimate how much logistics affect your company’s bottom line.
Better supply chain logistics yield hidden savings you don’t want to miss out on, so the sooner you prioritize logistics, the better your business will benefit.
Upgrade your technology to reduce errors and labor costs, and monitor your entire supply chain for new ways to optimize logistics by collecting data.