As supply chains diversify and become ever more convoluted, companies in all industries have come to expect disruption. But great complexity comes with a proportionate amount of risk. Without an experienced logistics partner or clear mitigation strategies, businesses face the prospect of shrinking margins and the ripple effect of a poor customer experience.
Why are Supply Chain Issues So Common?
A “perfect storm” of uncontrollable factors has brought us to where we are today. It would be impossible to isolate any one specific cause, but the shortlist includes rising fuel costs, labor shortages, port delays, regulatory changes, route and carrier disruption, political unrest, lack of capacity, and a massive increase in demand due to pandemic-related changes in consumer buying behavior.
All things considered, the logistics industry has rallied to meet demands quite successfully, proving its agility and resilience even in the wake of the most significant disruption it has ever seen. Though it’s not an ideal scenario in any sense, companies everywhere can learn from this experience. Today, we’d like to share some of the strategies we use at DTS World Cargo to avoid common supply chain mistakes.
9 Tips to Reduce Ocean Freight Costs
Tips to Help Avoid Supply Chain Mistakes
Here are four points to consider to help you avoid supply chain woes.
1. Simplicity is Key
Reducing product or SKU complexity is an excellent place to start. Projecting inventory needs and maintaining adequate stock, especially in peak seasons, are critical. Finding domestic sources for raw materials reduces manufacturing delays and prevents bottlenecks. The simpler, the better!
2. Always Plan Ahead
Knowing when and where to ship your products is key. The more advanced planning you can do, the fewer issues you will face. If you ship to multiple international regions, plan ahead, start small, and establish a supply chain flow before expanding to peak capacity. Avoid waiting until the last minute to plan, as conditions today are not conducive to on-the-fly changes.
3. Financial Control
Maintaining positive cash flow is essential and controlling costs is at the heart of this effort. But with mounting complexities throughout the global supply chain, you need an expert in your corner. Working with an experienced 3PL helps you reduce costs and anticipate and mitigate a wide range of risk factors that could threaten your margins.
4. Updated Technology and Expertise
Technology is the glue that holds the supply chain together, enabling visibility, transparency, and simplifying documentation workflows. As the labor shortage continues, the right tech helps us accomplish more with less, helping logistics professionals achieve what they need to do with greater accuracy and speed. From real-time door-to-door tracking to warehouse management systems (WMS), today’s cloud-based software gives companies the data they need to make timely business decisions and avoid many common supply chain issues.
Working with an experienced logistics partner like DTS World Cargo gives you access to trusted expertise to help you grow. We’ll work closely with you to improve supply chain sustainability and reliability and help you reduce costs in any way possible.