Whether you’re buying products as a reseller, manufacturing with the help of raw material providers, or getting your own goods out as a wholesaler, there are few things that matter to the continuity of your business quite as much as your supply chain.
Here, we’re going to look at the steps you can take to ensure that each link in that chain is just as strong as it needs to be, and why it’s so important to focus on it.
Make sure you can trust your partners
When you’re looking at your partners, be they suppliers, fulfillment partners, wholesalers, or otherwise, the first thing you should focus on is regulatory compliance.
If the businesses you rely on aren’t compliant, then any legal trouble they hit can disrupt your business.
What’s more, they can even get you in some legal trouble if you are, for instance, being supplied with and selling products that aren’t meeting regulations.
Check where you should import/export from
The cost-effectiveness of your supply chain matters a lot in keeping your business profitable.
As such, when you’re looking at suppliers and resellers, be sure to look at whether importing or exporting could help improve that cost-effectiveness.
Find the relevant data on your market, like these confectionery industry statistics. See that you’re building the overseas partnerships that can help you take your business to the next level.
Measure the reliability of your partners
Bad supply chain relationships are the most common cause of supply chain weakness.
Effectively, you need to make sure you’re taking the time to research the key suppliers in the area. The best suppliers might be a little more costly to work with, to begin with, but at least they’re likely to be more reliable.
Furthermore, if you build good long-term relationships with suppliers, it’s likely that the price of working with them can decrease as they start to focus more on long-term profit with you, provided you prove to be reliable too.
Make it as traceable as possible
What makes a good supplier, fulfillment partner, reseller, or any other kind of partner in your supply chain? Transparency is number one and it should be an asset that you both keep a lookout for and constantly encourage your partners to provide.
For instance, they should be willing to share the location of your goods with you through fleet GPS tools at all times.
This way, you can continuously track their performance, which is not only good for measuring efficiency, but for keeping your customers in the loop, too.
Reduce errors on your end as much as possible
Supplier and fulfillment errors can happen, but so too can errors on your side.
Rather than using simple spreadsheet software to track each link in the chain, for instance, you should make sure you’re using supply chain specific tools to make sure you’re not prone to errors.
Any disruption in your supply chain will cause a disruption to your business.
Finding reliable partners, tracking the data of each link, and being prepared for hiccups can all help you ensure that chain remains strong regardless of what ripples come your way.
How Demand Planning Can Improve Supply Chain
Companies are constantly looking for ways to maximize profits. The supply chain needs to be efficient for high business profits. An accurate demand forecast ensures the supply chains, inventory, and revenues are efficient.
Demand planning software helps in analyzing data metrics essential in demand predictions. This article describes how demand planning improves the supply chain and its aspects.
Aspects of Demand Planning
Demand planning includes three primary aspects including;
Product Portfolio
The product portfolio management oversees an overall good life cycle. It begins when a company introduces a new product in the market and concludes with end-of-life planning for the product.
Product lines can be interdependent. Understand overall product management to increase market share.
Statistical Forecasting
Historical data helps in creating statistical forecasts. Determining the accuracy of statistical models, identifying outliers, and understanding assumptions are essential.
Seasonal shifts and boosts in yard sales can be accessed using statistical forecasting.
Trade Promotion
Marketing events impact demand for products in the retail sector. The vision of the campaign is to connect brands with customers. In-store giveaways, promotions, and discount events influence demand for goods.
Benefits of Demand Planning
When products run out of stock, companies lose revenue. Customers can shift to other stores with a constant supply of products. On the flip side, unused inventory accrues production and storage costs. Demand planning helps business owners make proactive decisions and respond to customer needs.
The advantages of demand planning include:
Improving Forecasting Accuracy
The process of coming up with accurate forecasts can be challenging. Demand planning relies on this aspect to increase revenues.
Predictions help in knowing the number of products is needed by customers. Adjusting the forecast results keeps on improving their accuracy.
Managing Inventory
Demand planning helps in managing and aligning inventory amounts with changes in demand. Business owners incorporate demand predictions with actual signals to stock the right amount of products.
Proper inventory management ensures companies have enough raw materials and goods to sell in high-demand periods. The companies don’t run out of stock and don’t hold slow-moving items for long.
Improving Production Scheduling
When businesses forecast sales, manufacturers can plan for the products’ production schedules, warehouse, and shipping.
Planning saves costs. Optimizing production schedules around downtime can prevent unexpected machine breakdowns.
For instance, you can use a capacity plan to determine the best period to conduct regular and mandatory maintenance of machines.
Optimizing Labor Scheduling
Labor costs cover the most significant expense for manufacturers. Knowing the exact number of employees, you’ll need incomplete orders on time will allow you to hire only when necessary.
Few employees in high-demand seasons will cause your business to experience decreased fulfillment time, and the daily order completing rate will be lower. Hiring excess employees will be costly.
When inventory management, predictions, and labor/production scheduling are more accurate, your business will be able to determine the number of employees essential in the timely completion of orders.
The supply chain efficiency depends on accurate demand forecasting. Meeting customers’ demand efficiently increases revenue for businesses. Hire demand planners to carry out the forecasting process for your company.