For a business to operate efficiently, all aspects or departments of it must run smoothly. Most of the departments in a well-established business are usually interlinked. Marketing is linked with production, while production is associated with finance. The finance department is there to make sure the business maintains a good profit margin at all times. Human resources have to take care of the staffing needs for each department. One other aspect of a business that also forms the basis of its operations but is not much spoken about is supply chain management. So today, let’s talk about the role of supply chain management.
What is Supply Chain Management?
The term “supply chain management” refers to the process of handling the flow of production of a product or service, all the way from getting the raw components to preparing the final output that’s delivered to the consumer. The process involves working with a network of suppliers that act as links in the chain. These links move the components along from one supplier to another until the product is fully ready and reaches the organization that directly deals with its users.
Many manufacturing companies that run the whole or part of their business operations online often talk about their supply chain on their official website. These manufacturing websites represent those companies that supply goods to convenience stores and wholesalers, which in turn sell them to the end consumers.
But here’s why supply chain management is not discussed as much as the other integral parts of a business. There are certain challenges associated with supply chain management that many businesses tend to ignore. This is because the management of large companies often tends to think that they can get away with them. It is true that these challenges or issues can be kept a secret in the short term, but they do end up causing harm or losses in the longer run. Some of these issues are as follows.
Quality Standards and Defects
Manufacturing is never perfect. There are always certain inefficiencies or flaws in the manufacturing unit of every company, which is why the process needs to be monitored at all times for effective supply chain management. Variability and complexity are part of the production. The challenge is to adhere to the quality levels of the relevant authorities. Since companies tend to skip adherence at times, they avoid discussing the details of their supply chain management and order management.
Differing Time Zones
Many times, the links associated with a supply chain are operating in different time zones. This means the waking and working hours differ and do not exactly coincide. This makes it a challenge to coordinate properly for effective supply chain management. Sometimes, a supplier or reseller might have to wait for a whole day to clarify a question about a product or process. For companies running nimble operations, one whole day’s delay can be too long.
Social Compliance Issues
Besides complying with the quality standards of the authorities, companies also have to pay attention to social compliance, especially if they are into global sourcing. Due diligence needs to be conducted regarding the acceptable working conditions. Child labor practices, fair compensation practices, and forced labor. There is really no surefire way of ensuring complete social compliance all across the globe. This causes risks, such as damage to the brand image caused by illegal or unfair practices. In an attempt to cover such risks, companies tend to talk less about their supply chain management.
The advantage of working with global partners is that they can offer competitive prices. But the problem is they conduct their business in a different language. Usually, the managers in most countries can speak English, but the other staff communicates in their local language. It is therefore difficult to pass on instructions, as a lot of words are lost in the translation. This gives rise to errors in an otherwise potentially effective supply chain management.
Although these risks are real, they are not insurmountable. Companies that are involved in global sourcing opportunities can mitigate these risks by hiring partners who are multilingual and have experience and exposure in the country they have to operate from. If these issues are handled properly, sourcing from foreign countries is very beneficial to supply chain management
The Importance of Supply Chain Management to Business Owners
Implementation of effective supply chain management helps business owners to reduce the costs of their business operations. It also minimizes waste and saves time in the production process. These days, many companies follow the standard of just-in-time supply chain management, whereby the sales at a retail outlet automatically send a signal to manufacturers to replenish orders. This means the store shelves are restocked almost instantly as and when a product is sold. A way to make further improvements is to analyze the information from suppliers to check for any bottlenecks or delays in the process.
The benefits or importance of supply chain management is further enhanced by the following scenarios.
Identifying Potential Bottlenecks
Consider a situation where a customer places an order for a product in a larger quantity than the manufacturer is able to deliver. If the quantity ordered does not arrive on time, the customer might complain about the poor service. To avoid this, companies need to conduct data analysis and identify potential problems in their supply chain management in advance, so that they can anticipate any such shortages before the customer is disappointed.
Optimizing the Price
Price needs to be taken as a dynamic factor. For instance, seasonal products have a short and limited shelf life. When the season is ending, these products need to be scrapped or sold at a clearance price. Hotels and airlines that use many perishable products also need to adjust their prices dynamically for effective supply chain management. T-shirt businesses need to keep a check on their prices to put up with the ever-changing fashion trends. They can use analytic software in their supply chain management procedures for this.
Effective inventory management is the key to effective supply chain management. Resources need to be allocated dynamically and work needs to be scheduled according to the sales forecasts, orders received, and promised delivery of raw components. To avoid incorrectly filled orders, manufacturers need to confirm the goods’ delivery date as soon as the order is placed.
Effective Supply Chain Management in an Online Business
If you are running a business online, you are probably selling your goods or services through a website. In order to stand out in the world of e-commerce, you need to use an efficient, user-friendly, responsive, and simple-to-use website builder to create your company’s website. On the same website, you can also mention your supply chain management procedures and policies. One such platform that has recently gained popularity is Strikingly.
Image taken from Strikingly
Building a website in Strikingly saves a lot of time. All you need to do is sign up for a free Strikingly account. Then you click on ‘Create New Site’, and you will be taken to a page that shows a variety of Strikingly website templates for you to choose from.
Image taken from Strikingly
Once you select and install a suitable template, you can use the Strikingly editor’s drag-and-drop feature to key in all the information that you want to provide to your audience on your website. The key elements to include are as follows.
Basic information about your company and the products or services you offer
Contact information and call-to-action guides
Terms and policies relevant to your business
Introduction to your supply chain management procedure
Adjust your store settings according to your business needs.
Image taken from Strikingly
The store section is where you will add all your products, set the prices, write product descriptions, and select suitable payment gateways to be able to accept credit card payments from customers who buy from your online store. All this needs to be in line with your supply chain management process.
Image taken from Strikingly
Strikingly makes it easy for you to carry out supply chain management from your website. For handling your orders efficiently, Strikingly will provide you with an integrated order management system with your online store. This will enable you to receive, accept, process and track each order that you receive in the store.
By building a website in Strikingly, you will be able to rid yourself of the tension and hassle of dealing with a web developer. This tool not only saves the costs incurred in running a business online but also saves a lot of time and energy on your part, which you can then spend on the other integral and important aspects of your business. Since you will be able to better focus more on your supply chain management, your business productivity and efficiency will increase while your overhead costs will decrease. Sales will come inconveniently and orders will be tracked with ease.
If you are interested in reaping all these benefits of efficient website building and effective supply chain management, get your website built in Strikingly today!