This was provided by Marcus Lansky information@abilitator.biz 

Every day, businesses are faced with supply chain slowdowns. Whether it is a factory that needs to produce more products or a retail store that needs to ship more goods each day, the supply chain is constantly in flux. In fact, 75% of companies have had negative or strongly negative impacts on their businesses.

Morgan Stanley explains what happened as “a sharp but short-lived decline in demand early in the pandemic prompted many firms to trim inventories and production.” Soon after, however, US consumer spending on durables in 2021 grew 40% higher than it had been just two years earlier. This was made possible by an infusion of cash in the way of stimulus checks to Americans.

Today, HEY Growth Hub explains how you can work through supply chain issues in these challenging times.

The Challenge

The primary challenge that companies now face is to improve the resilience of their global supply chains without weakening their competitiveness. One important key to overcoming these slowdowns should be to start getting ahead of them so that they can be avoided in the future.

Evaluate supply chain scenarios: run simulations to predict when and where excesses and shortages are likely to occur. Also, increase your business’s flexibility, perhaps by trying to repurpose existing assets and inventory.

Your Suppliers

Communicate regularly with your suppliers. This means calling overseas suppliers at least twice a year and visiting suppliers that are close by. Investigate your suppliers and find out how your supply chain works. This includes knowing the plant locations and what each plant makes. Understand that the supply plant may not be at the company’s headquarters. Can you build your product without it, or do you have other suppliers of this part elsewhere? What are each plant’s operational status and inventory levels?

Inventory

Use smart technology to improve your physical inventory. For instance, product expiration and product loss costs U.S. grocers $1.2 trillion annually according to the Boston Consulting Group. Use a quality inventory tracking system to track goods across the supply chain, from ordering items from suppliers and vendors to delivering products to end consumers. By tracking inventory across the supply chain, you can monitor trends and identify areas for improvement. Tracking your inventory will help you to make smarter decisions, such as keeping additional spare parts in stock to address common equipment breakdowns.

Also, semi-annual audits can help you objectively evaluate whether you or not your old suppliers are still worthwhile resources. Some suppliers that have the potential to save you money can be tempting but may have unintended negative consequences. Remember, small businesses are usually hit the hardest when their supply chains fall apart.

Look for Alternatives

Changing your approach to your product and production methods can also be a valuable method for making sure you can survive a supply chain shake-up. Pivoting can help you capture sales, move inventory, and stay operating. Move beyond more traditional performance metrics, such as cost per unit, and focus on minimising constraints and increasing high-priority items.

Ways to Save

While supply and demand are causing your inventory costs to increase, look for ways to save money in other places. Ask your bank about fee-free business accounts and if they do not offer that, transfer to a bank that does. Can you adjust the thermostat in your offices to reduce your utility bills? Is it more cost-effective to have some of your staff work remotely, allowing you to move to a smaller office with a lower lease price?