Supply chain management is an effective collaboration between several networks in a company that fulfill each other’s needs. Supply chain maintenance is quite complicated, but if it can be done efficiently it can make a business grow very rapidly. Currently, supply chain disruptions are occurring all over the world, including in Indonesia. Therefore, supply chain developments seem to have stalled for the past two years.
Now that conditions are gradually recovering, many e-commerce businesses are using technology and implementing automation in their logistics systems to achieve supply chain resilience. Although complicated and quite tiring, supply chain management is something that is very useful. Many industries and businesses (such as food and grocery delivery services) operate effectively because of effective supply chains.
What is supply chain management?
Supply chain management combines technology, resources and expertise to provide smooth delivery of goods and optimize existing networks to reduce costs and maximize profits. In today’s highly competitive business climate, it is very important to improve supply chain and achieve supply chain resilience so that your business can deliver extraordinary results with relatively small expenditure.
Supply chain efficiency
So that we understand how important the supply chain is, let’s look at the example case study below:
During the COVID-19 pandemic in Indonesia, almost all industries were paralyzed and suffered unavoidable losses. But not all industries are paralyzed, there are still some that can run thanks to efficient and effective supply chains such as the e-commerce industry. When purchasing conventional goods is completely dead, many e-commerce platforms are still able to operate by utilizing their networks such as dropshippers, shipping partners, warehousing, and digital management systems which make operational functions very effective and efficient.
There is also a change in the mindset of consumers who tend to buy daily necessities as well as medical needs such as masks, hand-sanitizers, anti-bacterial sprays, and medicines or vitamins. This made sales figures in both categories of goods skyrocket because of the large number of requests. Fortunately, with the existing supply chain management, the supply of these goods can be controlled so that there is no scarcity that causes high prices. This example shows how important supply chain efficiency is to maintain business continuity during uncertain or disrupted conditions.
Operational perfection
How can the e-commerce platform continue to operate during the pandemic? The answer is a digital-based operational, management and supply chain system. With the help of technology and automation, management and operations are becoming more streamlined and easier to monitor, so they can easily manage existing operations without having to spend a lot of time and money.
The digital system adopted by the e-commerce platform has become a very influential thing for their operations and business. They can see the entire operation easily and are also able to identify various threats and turn them into opportunities. By intensifying the workforce and using digital technology and automation, a company can minimize possible losses and gain huge profits.
9 ways to improve supply chain management
Take advantage of technological developments
As you already know, the use of technology will greatly affect a business. A strong digital-based supply chain can help resolve existing complexities and provide overall transparency. There is a lot of software that you can use, such as inventory management, order tracking, and company resource planning that can be integrated with various e-commerce platforms, websites and applications.
Build good relationships with suppliers
Having a good relationship with suppliers can bring you many advantages. You can negotiate prices, ask for discounts, and have reliable supply partners to provide quality products, avoid product shortages, and track the movement of goods before they are processed into finished goods. Strengthen relationships with trusted suppliers in providing quality goods and keep in touch with them to grow your business.
Take advantage of outsourced labor
When your supply chain conditions are too thick and complicated, using a third party service is the best solution. A supply requires regular monitoring and development, it would be very difficult to do it all alone, and even if it could, the results would not be optimal. The use of outsourced personnel in logistics and inventory management will be very beneficial for your business. In accordance with the existing business model, you can do the division of labor. Third parties will give you amazing results that you can’t get if you do it yourself.
Inventory management
Inventory management is an important part of the supply chain. You must balance the inventory that you have and must continue to be maintained in order to avoid chaos. If a product is out of stock there will be supply constraints that will make your customers unhappy, on the other hand if you hoard goods there will be wastage of goods. Therefore it is very important to be able to balance your inventory.
Improve existing distribution and network strategy
A strong distribution strategy is the forerunner of supply chain resilience because it affects the entire supply chain system, from raw material planning to last mile delivery of goods to customers, all connected to the existing distribution strategy.
Use smart warehouse
Smart warehouses that use the latest technology are the thing that is being loved in the supply chain. Many e-commerce businesses use modern warehouses for efficiency in inventory management, real-time tracking, and automation of product fulfillment, as well as to increase overall productivity. A modern inventory management system like this allows you to quickly send goods to customers.
Use a warehouse management system
The warehouse management system oversees all daily activity on inventory. Having a strong warehousing management system is needed to automate the fulfillment process by ensuring stock availability for last mile delivery, the warehousing management system will record and optimize everything directly.’
Define supply chain benchmarks
Determining benchmarks or standards in supply chain management can provide an overview and targets that you can achieve. Although it is important to maintain efficiency in the supply chain process, if there is no goal to be achieved there will be no motivation and path to do so.
Optimize supply chain on a regular basis
There is always the possibility that a business or supply chain may face a surprise down the line. The strategy you use today may not be effective in the future. Therefore innovation and renewal need to be done to protect the supply chain of a business.
Conclusion
Many companies rely on third party services to get input and insight from logistics experts to develop their supply chain. Logistics keeps the supply chain running efficiently. If you are experiencing complex logistics, it is highly recommended to use the services of a trusted logistics aggregator such as NimbusPost which keeps everything under control.
