Bend, don’t break: The importance of strengthening your supply chain
You may think your supply chain is perfectly suited to its function. You might have been running it in exactly the same way for many years. But your seemingly functional supply chain could have underlying issues that you are blissfully unaware of, all of which will only come to the fore when a crisis occurs or if your business rapidly expands.
That’s where stress-testing and strengthening your supply chain comes in.
If your supply chain has been properly tested and improved ahead of time, you can iron out any problems before it’s too late, saving you time, stress, and money.
Your supply chain should be ready for anything
For 30 years, US sparkling water brand LaCroix catered almost exclusively to a medium-sized market in the country’s midwestern region. Then, almost out of nowhere, the brand caught on nationwide. In 2016 it reached its peak, with young women wearing “LaCroixs Over Boys” t-shirts, and Time Out New York ranking its 17 flavours. As an in-depth investigation from Vox makes clear, LaCroix became a lifestyle brand, not just a water brand, in a rapid space of time.
Thankfully, LaCroix’s supply chain was set up to handle the extra demand this newfound popularity brought with it. Over its three decades of operation, the company had established a supply chain that could be rapidly scaled up without any detrimental impact on the rest of the business.
Every retail company’s dream is to have their products become this ubiquitous, but would your business be ready if it happened to you? Specifically: would your supply chain be ready? Unless you’ve stress-tested and bolstered it already, you can never be sure. So read on to find out how to best go about stress-testing your supply chain, and in turn prepare yourself for major success.
Stress-testing and improving your supply chain: Tips & considerations
Hire an external auditor
Here at Retail Asset Solutions (formerly OCS Retail Support), we provide professional supply chain audits that will help your business run at its best. Sometimes an objective perspective can be exactly what a company needs. Our expert auditors will look at your current operation and identify its strengths and weaknesses, before giving advice and making suggestions on what needs to be tweaked or improved.
Change what you’re measuring
It may not be essential, but changing the key supply chain factors you are measuring can make a big difference to how effective it is. Many companies, for example, will look at the timing items are shipped as a barometer of success. The more products they ship on time, the more effective their supply chain is. But that’s not the case. The most important thing for a retailer is that the products arrive with the customer on time, not that they leave the warehouse on time. Switching the measurement to track on-time deliveries will make it much easier to optimise your supply chain.
Make use of all related data
Though it may seem purely practical in nature, your supply chain also acts as a huge data source. When closely examined, it can tell you a number of important things about how your business works. At a glance, there are the number of orders, the number of deliveries, the number of parts it takes to assemble a product (if applicable).
Collecting this information and examining it carefully will not only tell you how to strengthen your supply chain, but how to strengthen your business as a whole. If you find that one of your products is always bought alongside another, for example, you could consider bundling the two as a pair or introducing a special offer.
Keep working on improving your supply chain
Improving your supply chain is not a one-off thing. As you run your business, you should continually be finding ways to strengthen and optimise the way your supply chain works, and you can do that by engaging your employees. Since they likely work closer to the supply chain than you do, your employees are more likely to come up with shortcuts or changes that your supply chain may need. Encouraging workers to come up with supply chain improvements on the job can be hugely advantageous.
Some companies do this by offering incentives to workers who come up with supply chain-improving ideas. Whatever your approach, making sure your supply chain is under constant scrutiny is the only way to make sure it’s at its best.
Baring all these things in mind should help you keep your supply chain strong enough to withstand any challenges, and help it evolve with your business.
For more information on supply chain audits, get in touch today.