As technology continues to advance, the market will continue to be consumer driven, as consumers are being trained to demand more in less time. Technology allows many companies to give customers what they want when they want it, and from wherever they are located. For businesses to fulfill these wants they need to recognize and resolve all challenges they may face in their supply chain.
To stay competitive, businesses need to educate themselves on the challenges that come with providing on-demand services or products, so that they can continue to navigate current market trends and maintain customer satisfaction. To help with this, we have listed 4 challenges businesses face when managing increasing demands.
Lead Times Are Long and Risky
There can be a high price to pay if your business works with both foreign labor and cheap labor. The main cause is the amount of time it takes for a shipment to arrive. Not only that but a lot of unexpected problems could occur during the 50 days of travel at sea. Also, it is kind of hard to cancel an order as it sits in the middle of an ocean on a cargo ship.
Problems at sea can instantly double delivery dates if the cargo is lost, stolen by pirates or if the receiving port has labor strikes.
Every business dreads disappointing its customers and explaining why there are delays. No matter how small the delay is it can still cause major problems for your supply chain.
Increasing Business Complexity
With many companies needing to be complex this might become the only way to remain competitive. To compete successfully many companies have relocated their manufacturing overseas. This way they have a reduced amount of labor costs. This seems to be the norm today for businesses to be able to manage their complex supply chain across various locations and time zones.
If your business plans to utilize a more lean model for distribution and manufacturing make sure that it does not happen at the expense of quality or productivity. Also, remember to not overemphasize your cost cutting because it can be detrimental to a successful supply chain. A good example of this is the hindrance it can cause as you try to adjust to the supply and demand without worrying about losses.
No Strategy for Risk Management
Every company is familiar with taking risks. But, what some companies fail at is how to manage that risk once something goes wrong. Risk is unavoidable but only if you have no strategy for risk management.
What business owners must keep in mind about supply chain management, is the importance of familiarity with the process. That way it’ll align perfectly with other aspects of a business, and create a smoother experience for consumers.
Learn how working with a logistics partner can help you automate your supply chain and scale your business. The Freight Hub Group is an asset-based 3PL provider, meaning we offer all logistics services in one place (inclusive of transportation, container drayage, warehousing and much more). We have served owners of businesses varying in size and product for more than 10 years.
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