With continued supply chain management issues throughout 2022 and predictably going into next year, there are some actions your business can take to ensure that products are delivered on time and in an efficient manner.
Here are three ways your business, can effectively handle supply chain management issues that may arise.
Create a Plan to Retain Drivers
As the “Great Resignation” continues to plague businesses across the U.S., it’s time to start reassessing some of the processes and procedures that may turn employees off to the trucking industry.
Regardless of the number of drivers you currently employ, it’s always a good idea to periodically review what your drivers are sharing regarding their trips. After all, the transport of goods and the functioning of supply chains are impossible without drivers.
Here are a couple of ways you can increase driver retention:
- Invest in driver retention. which includes periodic increases in pay and addressing safety concerns.
- Have a driver app. Pay drivers per drop or delivery in the last mile instead of paying through traditional salary or hourly rates.
Remember: Goods and raw materials cannot be sold or sent to customers when they are not moving. It’s better to keep your current drivers rather than look for replacements.
Localizing the supply chain
Because of growing nationalism, environmental concerns, and other factors, localizing the supply chain has been a rising trend even before the pandemic. It’s something to consider, especially since petroleum prices can increase at any moment – as discovered in 2021 and this year.
Fortunately, disrupted supply chains can be mitigated by integrating Warehouse Management Software (WMS) and Order Management Software (OMS) with demand forecasting and business intelligence. WMS and OMS give customers and warehouses visibility into inventory levels, receipts, orders, and shipping, supporting the stability of the supply chain and preventing stockouts.
It is also essential that all participants in the supply chain form strong partnerships to ensure localization is successful. Managing carriers, suppliers, and clients is a responsibility of third-party logistics (3PL) warehouses, making them ideal leaders for localization efforts. More importantly, COVID-19 has exposed problems that 3PLs can help solve with the right technologies and localization strategies.
Forecasting for inventory and delivery
Inventories are forecasted using past data, trends, and upcoming events to determine their needed levels in the future. Businesses can avoid tying up cash in unnecessary inventory by forecasting accurately, so they have enough products to fill customer orders.
More importantly, using data analysis to identify patterns and trends is more than just setting a reorder point – it adapts to dynamic conditions and meets customer demands. Reorder points are just one piece of the puzzle since inventory forecasting encompasses much more.
Here are some scenarios you may have likely faced while trying to accurately forecast for inventory and delivery metrics:
- Maintaining enough products on hand is easier when demand is forecast.
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- This allows you to avoid wasting storage space on unnecessary products.
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- In order to meet peaks in demand, you will need to keep enough stock on hand to meet supply and demand.
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- Fortunately, many formulas can help you determine how much stock you need.
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- Demand for your product can be affected by a variety of factors.
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- Shipping times can be impacted by external factors, such as tornado weather or a thunderstorm, and internal factors, such as a marketing campaign reassessment or product pivot.
Conclusion
Regardless of the different ways you may be looking to improve supply chain management, it’s always a good idea to ensure your products can meet the ever-changing needs of your customer’s demands.
If you’re looking to transition to a new freight provider, we at Elder Logistics can help discuss an action plan to help you transport your goods safely. Reach out to us here to communicate with one of our customer service representatives.
If you have any further questions, feel free to reach out to any of our management team members here, and we’ll be more than happy to help you find the best transportation solutions for your business needs.
References:
“Going the Distance: Managing Freight Costs and Delivery Delays in 2022.” The National Law Review, National Law Forum, LLC, 23 June 2022, https://www.natlawreview.com/article/going-distance-managing-freight-costs-and-delivery-delays-2022.
Hawkins, Ashley. “Localization of the Supply Chain.” 3PL Central, 3PL Central, 19 May 2022, https://www.3plcentral.com/blog/localization-of-the-supply-chain#:~:text=Supply%20chain%20localization%20refers%20to,environmental%20concerns%2C%20among%20other%20factors.
Jenkins, Abby. “Inventory Forecasting: Types, Best Practices, and Benefits.” Oracle NetSuite, Oracle, 11 Jan. 2022, https://www.netsuite.com/portal/resource/articles/inventory-management/inventory-forecasting.shtml.
Laloum, Deborah. “8 Logistics and Supply Chain Trends to Expect in 2022.” Bringg, Bringg, https://www.bringg.com/blog/logistics/supply-chain-trends/.
Schulz, John. “State of Logistics 2022: Out of Sync.” Logistics Management, Peerless Media LLC, 19 July 2022, https://www.logisticsmgmt.com/article/state_of_logistics_out_of_sync.
“Transportation Industry Trends 2022: Logistics Landscape: Mercurygate.” MercuryGate International, MercuryGate, 2 Aug. 2022, https://mercurygate.com/collateral/industry-report/2022-logistics-landscape/.