How to Optimize Your Supply Chain for Business Success?


There is no doubt that a company’s performance is tied to the success of its supply chain. For a current CEO looking to expand into new geography, or the founder of a start-up looking to capture a specific market, optimizing the supply chain can mean the difference between a 7 percent profit margin and a 20 percent profit margin. 

In many cases, supply chains are not very efficient. With an ever-evolving marketplace and supply chain participants, the industry is untapped and chaotic. Countries, governments, customers, and other factors influence the supply chain, making success nearly impossible. Supply chain costs tend to sink in before a business can generate a profit. However, diligent and intelligent global sourcing companies can succeed.

5 Ways to Optimize Your Supply Chain

  1. Developing a supply chain strategy

Supply chain management is considered a stand-alone function within the company in most companies rather than part of the overall business strategy. However, this is a curious fact. It’s no exaggeration to assert that the supply chain is one of the most essential elements of a successful global business. Conversely, companies that treat the supply chain as an extension of themselves, rather than a primary function, tend to struggle more with success.

By applying the supply chain to your business strategy and goals, you can better leverage your supply chain to achieve your defined metrics.

  1. Designing a Supply Chain Network

Just as integrating the supply chain into the business strategy is key to success, designing the supply chain network in order to function at an optimal level. Within the supply chain, we will focus specifically on outbound distribution. For the rest of the network design, it is necessary to be flexible and adapt to changing needs and requirements over time. In addition, if your supply chain is already in motion and has not yet been optimized, consider auditing and reviewing your network design to see how far you can go to improve efficiency with the systems already in place.

  1. Customer Satisfaction

If you would like your business to succeed, you need to focus on how well your supply chain can satisfy your customers. By putting the customer first and optimizing your supply chain, you should help your customers. If you can’t meet your customers, you will eventually lose them, and your business will cease to exist.

Here are factors that can negatively affect the performance of your supply chain.

  • Long time-to-market
  • Long delivery times
  • Delays in responding to customer service requests
  • Poor on-time delivery
  • Lack of order fulfillment
  • Increased waiting time due to lack of inventory
  • Poor quality of service
  • Poor product quality

If you are experiencing any of these problems in your current supply chain, we recommend addressing them immediately:

  1. Identify the root cause.
  2. Solve the root cause.
  3. Review and analyze the solution frequently to make sure it is working.
  4. Ethics and responsibility

Based on the previous point, you need to manage your supply chain and your overall business correctly. Although the different actors in your supply chain are separate entities and companies, you still have a responsibility to ensure ethical sourcing and corporate responsibility. If something goes wrong with your supply chain, your business will be responsible for the impact on your reputation in society. Therefore, treat your supply chain to the highest standards as you strive to meet market needs.

  1. Logistics Inventory

Inventory management is a huge factor in the success of your supply chain. Whether you have a lot, a little, or just the right amount of inventory will affect the success of your business. Too much stock means that capital is tied up in products that you may or may not be able to sell, which can lead to huge losses if the market changes. Keeping your inventory at the amount the market needs is a balance you need to master.

There are many China sourcing companies which work with you to better optimize your supply chain. Although the optimizing process is pretty complex, they have years of global experience and a team of expert professionals for this task.

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