Streamline Your Supply Chain: Best Practices

Inefficient supply chain management can lead to significant costs for businesses. According to Accenture, inefficient supply chain management can lead to a 20-30% increase in overall supply chain costs, and every supply chain disruption can cost companies an average of $1.3 million. On the other hand, companies with high-performing supply chains achieve revenue growth superior to their industry average, with 79% of them reporting such success.

However, you can streamline your supply chain and improve efficiency by identifying bottlenecks and implementing best practices. In this article, we will discuss the most common blockers and suggest 5 different ways to improve supply chain performance.

How to identify bottlenecks in your supply chain

The first step to streamline your supply chain is to identify bottlenecks and weak spots in your current system. It's important to review all steps and processes of the chain to find any that can slow down the overall flow of products and information.

Here are three common bottlenecks to watch out for:

1. Logistics. Inefficient transportation routes can lead to delays and higher delivery costs. By finding the most optimal transportation methods and routes, you can reduce transit times and lower transportation costs.
2. Communication. Miscommunication between manufacturers, retailers, and distributors can lead to supply chain disruptions and delays in product delivery. To prevent such issues in your supply chain, establish clear lines of communication through emails, instant messaging, and video calls.
3. Inventory management. Poor inventory management can lead to stockouts or excess inventory, which can be costly for businesses. By implementing inventory management best practices such as just-in-time (JIT) inventory and using inventory management software, you can optimize inventory levels and reduce costs.

Identifying bottlenecks is the first step toward improving your supply chain efficiency. Now, let's explore some best practices that can help you streamline your supply chain even further.

5 best practices to streamline your supply chain

To optimize the overall flow of products and information, you need to adopt best practices that automate processes, use data analytics, and develop strong relationships with suppliers and retailers. Let's explore some of these best practices in more detail.

#1. Automate processes with new software

One of the most effective ways to streamline your supply chain is to automate processes using new software. For instance, inventory management software can track inventory levels in real-time and generate purchase orders automatically when inventory levels run low. And order fulfillment software can also help automate the picking, packing, and shipping of orders, which reduces the time it takes to process orders and improves order accuracy.

That said, investing in a powerful enterprise resource planning (ERP) system that integrates all the above-mentioned separate systems can be a game-changer for many businesses. Such software can store all the updated information in one place and allow all participants in the supply chain to have access to this data, which can improve communication, efficiency, and decision-making.

#2. Share updated product data with business partners

Retailers and distributors need high-quality and updated product information to operate effectively and sell products to end customers, making safe and fast data sharing essential for product distribution.

For businesses working in the home improvement industry, Wizart has developed a special PIM system. This is a product information management system that stores the digital data of products, which can be visualized in the Wizart AR visualizer. The main purpose of Wizart PIM is to ensure the correct functioning of the visualizer, but it can also be used for data sharing between manufacturers, distributors, and retailers.

Wizart provides all its clients with access to personal PIM accounts, where manufacturers can share their digital data quickly and safely, and retailers can access the product data of over 450 brands.

#3. Use data analytics to identify trends

Data analytics can provide valuable insights into supply chain performance. By analyzing data on product demand, order volume, and delivery times, you can identify trends and adjust inventory levels accordingly. This can help prevent product deficit and dead stock, reducing waste and optimizing inventory costs.

#4. Develop strong relationships with business partners

Developing strong relationships between all the participants of the supply chain, such as manufacturers, suppliers, distributors, and retailers, is critical for ensuring a reliable supply and distribution process. By working closely with your business partners, you can build trust and transparency, leading to better communication and collaboration. This can help you anticipate potential supply chain disruptions and develop contingency plans to mitigate risks.

#5. Reduce waste by utilizing sustainable practices.

Sustainability is becoming increasingly important for supply chain management as businesses demonstrate their commitment to sustainability to customers while also cutting costs. One way to achieve this is by using sustainable practices in manufacturing and transportation. For example, you can reduce packaging waste by using recyclable or biodegradable packaging options. Another option is to optimize transportation routes to reduce fuel consumption, which not only reduces the carbon footprint but also lowers transportation costs.

As you can see, implementing best practices to streamline your supply chain is crucial for achieving a reliable and efficient process while reducing costs and improving revenue growth. By identifying bottlenecks, automating processes, sharing updated product data, using data analytics, developing strong relationships with business partners, and utilizing sustainable practices, you can optimize the flow of products and information and achieve success in supply chain management.