Supply chain management has been this complex, as companies have to control distribution, production, and inventory across several continents. Some business leaders have not yet implemented a comprehensive technology solution, with over 85% of them claiming they had problems with inefficient technological solutions for their supply chains.
Benefits of supply chain management
1. Improved collaboration between suppliers
Suppliers who understand the company’s budgetary constraints and goals are particularly valuable when it comes to businesses that have tight margins. When dealing with suppliers, retailers should strive for a “golden ratio” that is not more than 25% of raw material costs as a proportion of sales. However, the cost isn’t the only factor. Flexibility is also important. To improve collaboration, ListTrader provides Wholesalers & Retailers who share need lists and lists of their current needs and customers. They do this through email. No one is trading on one platform.
2. Improved risk mitigation
The further the supply chain management issue is identified, the more costly it will be to correct. This is how supply chain management provides transparency on the chain of supply from start to finish and is crucial. Most business owners follow six “links” connected with supply chain management.
Procurement and Sourcing
Transportation and Logistics.
3. Higher quality and better control of the process
If you and your suppliers adhere in accordance with the same standards and quality control procedures, problems with the quality of your products are often detected earlier. For example, one of the suppliers of packaging contacted us to tell us that the package that just arrived wasn’t in compliance with the standard and was planning to ship the package back, which would take three days off the timeframe for delivery.” This delay was better than having to address an unsatisfactory package. The importance of trust in supplier relations.
4. Optimization of shipping
The cost of logistics is expected to increase significantly, possibly impacting small companies. Reducing the number of different distribution channels and using logistic experts could help lower the cost of distribution relative to the competition. This helps you keep a stronger cash flow and profit. There are too many companies that have separate delivery and shipping streams is the main cause of inefficiency. ListTrader offers all data on trades that can help you optimize your shipping costs and view the real margin and profits from trade.
5. Lower inventory along with the overhead cost
A well-functioning supply chain will reduce the necessity of maintaining inventory, thereby reducing expenses associated with the storage of inventory and security. But a sluggish inventory can put a strain on distribution networks and decreases the resilience to shocks to the supply chain. It is, therefore, crucial to figure out the optimal level of inventory.
6. Stronger cash flow
A well-functioning supply chain that is built on good relationships with suppliers that maintain strict quality and stock control and maintains a close of costs and prices will greatly improve a company’s liquidity by boosting cash flow.