There’s a reason the supply chain is called what it is—all separate units rely on each other to work efficiently. When one part of the chain faces disruption, its inefficiencies ripple throughout all other parts of the system.
And in the past two and a half years, there has been a lot of disruption to the global market. The pandemic and labor shortage, in combination with skyrocketing demand in e-commerce, has sent many businesses scrambling.
Having robust supply chain management is crucial to prevent compounding losses. Here are our 6 tips for minimizing supply chain ripple effects.
Keep Up-to-Date Information
You can’t always predict distribution emergencies before they happen. But by keeping the most up-to-date information, you can be better prepared for when they do.
Get to know the most important entities in your market, their struggles, and their goals for the future. Note how they deal with disruptions, and how that affects you. Keep up-to-date on news regarding your industry and the state of the global supply chain.
Conduct Audits for Vulnerability
Managing a supply chain is about much more than just optimizing for the best-case scenarios. You should also frequently analyze your distribution strategies in search for areas that need improvement.
Conducting regular audits can expose vulnerabilities in your supply chain. With this information, you can invest in changes that will have the most advantageous results.
Create a Contingency Plan
When one part of your supply chain faces setbacks, the best way you can keep running business as usual is to adhere to a contingency plan.
This is a back-up plan that lays out the steps to deal with setbacks in your distribution chain. When forming this plan, consider the following:
- When and how will you alert customers of potential delays?
- How will you estimate inventory levels?
- Who can you contact for back-up supplies, delivering, or distribution?
- How much will delays in each segment of the chain cost you?
- How can you stock up on inventory to recover?
Build Relationships in Your Market
Building effective communication throughout your supply chain is another key to success. When disruptions arise, you’ll find it much easier to recover if the line of communication and trust is already built with your suppliers, vendors, and manufacturers.
Keep up-to-date on their practices and changes in operation, and build respect by meeting their standards as well. This respect will pay back when your business is struggling.
Be Flexible With Substitutions
When the product will not be delivered on time, and expedition is not available, be flexible with making substitutions.
Of course, you will want to stick to the original plan as closely as possible. But understanding the overall goal of the finished product will allow you to adequately designate substitutions.
Work With a 3PL
It can be difficult to manage resources between managing your supply chain and running your business, especially with the ongoing labor shortage. A third-party logistics company is built around distribution, so it has more access to workers, and it can more easily absorb supply chain disruptions.
A 3PL partner can help you perform the most effective inventory management, warehousing, and delivery services.
Trusted 3PL Provider on the East Coast
Don’t trust just any 3PL to deal with your most vital operations. Trust Cannon Hill Logistics to help your business thrive.
We have over 30 years of experience helping small and medium-sized businesses with all their fulfillment needs. With a headquarters conveniently located in Frederick, Maryland, we have access to the entire East Coast! Call now to learn more.