Wednesday, May 31, 2023

Strategies to Overcome Supply Chain Issues

By Nikhil Sonawane - March 28, 2023 6 Mins Read

Strategies to Overcome Supply Chain Issues

Supply chain challenges and issues can have disastrous impacts on business continuity. Organizations must implement strategic plans to respond to supply chain bottlenecks in real-time to reduce the impact on the organization.

The supply chain disruptions that occurred because of the global pandemic and political situations have long-lasting impacts on businesses. Supply chain leaders need to be vigilant about the issues in their distribution chain and work on them to improve the efficiency of their operations.

Following are a few strategies that decision-makers can consider to overcome the supply chain issues:

Suffice Customer Demand by Diversifying Suppliers 

Most enterprises give their clients a clear understanding of the costs, availability, and logistics times while purchasing. Organizations with supply chain issues won’t be able to keep up with customer expectations and meet the current requirements. Most retailers dependent on a single supplier do not consider customer demands and expectations. Supply chain disruption can be a result of multiple factors that are uncontrollable and can put the distribution chain at a halt.

Also Read: Top B2B Supply Chain Management Challenges Businesses Might Face in 2023

Organizations that face supply chain issues and want to overcome them must diversify suppliers to meet customer expectations and demands. E-commerce companies with multiple suppliers have fewer orders pending and can reduce the shipping times if one supplier fails to meet the demand.

Enterprises need to prioritize quality customer service to effectively meet customer expectations irrespective of what issues are faced. Diversification of the supply chain enables organizations to improve cost-effectiveness by selecting a supplier that meets the current budget requirements.

Make Strategic Changes in the Product

Supply chain challenges may arise due to faulty manufacturing or production bottlenecks. There is a significant possibility that businesses won’t be able to sell products with manufacturing issues; even changing the supplier might not help in such cases. Organizations must clearly understand the production challenges that drive customers away from the products. Supplier chain leaders can suggest changes based on customer feedback to improve product quality.

A blockchain is a potential tool that businesses can use to identify the issues in their manufacturing. Leveraging Blockchain in their enterprise tech stack will help track and monitor the products from procurement and manufacturing to delivery of finished goods to the end users. Utilizing this technology will help organizations track every supplier’s raw materials used in the product manufacturing process. Manufacturing units can even track the supplier utilized in manufacturing a faulty product batch and make necessary adjustments.

Efficient Inventory Management

Supply chain issues may arise because of not tracking the inventory efficiently. Efficient inventory management is the essence of a successful distribution chain throughout the organization. Overstocking or limited stocking than the demand will significantly influence the customer experience and result in higher costs.

Organizations can consider overstocking a few products when the supply chain challenges do not impact their inventory. However, it is not the best solution to supply chain problems.

Overhoarding products when the demand is low will increase the shelf life resulting in more damaged products and higher operational costs. Hoarding less stock than required will hamper the customer’s shopping experience.

Efficient inventory management is essential for organizations to have fewer supply chain issues that disrupt cash flow or increase operational costs. Business decision-makers can implement the best inventory management tools that keep track of the product in all the channels in real-time to make strategic stocking decisions.

Maintain Sufficient Stock While Demand Soars

Demand volatility is a crucial factor that affects supply chain management tremendously. Various factors influence the demand and supply in the market, and businesses need to be ready for all the circumstances to suffice the customer needs. When there is a surge in the market, many enterprises struggle to keep up with the pace because they do not have enough stock.

One of the crucial supply chain issues that businesses face when demand soars are limited factory inventory and a labor shortage to meet the demand. Such issues can create a negative brand image and will have an impact on the customer experience. Organizations that want to overcome this issue in their distribution chain need better analytics that helps predict the demand accurately.

Analyzing the previous purchase record with the help of robust tools like artificial intelligence (AI) and machine learning (ML) is an effective way to make accurate future sales predictions.

Business decision-makers can consider implementing a robust order management system with AI and ML capabilities to evaluate what products must be the top priority. Suppliers that can deliver more of these products should optimize their production as the demand in the market soars.

Enhance Customer Service

Challenges in the distribution chain can be tedious tasks for organizations, and they can lead to an unsatisfied customer base. Customers have higher expectations from brands and do not want to understand the brand’s challenges in meeting the expectations. Clients want to feel valued for their business and expect brands to act as per their demands.

Enterprises that want to reduce to enhance their supply chain management need to have a proactive and effective customer service approach. It is crucial to be transparent about the current and potential supply chain issues with customers will help to enhance the customer experience.

Also Read: Top Supply Chain Best Practices to Adopt in 2023

Make the Most of Pricing Deals

Pricing can also tremendously influence supply chain challenges. Hence, when the purchasing cost of goods is less, organizations can stock up to save a substantial amount. But this approach is only effective for non-perishable goods distribution chains.

One crucial aspect that businesses taking this approach need to consider is their ability to hold products in their warehouses. Organizations with better-holding capacities can consider this approach, but it will increase the operational cost, which goes against saving money.

Severe supply chain challenges arise due to utilizing traditional and outdated methods for their distribution chains will result in disruption that cripples the business operations. Organizations must be vigilant while handling supply chain issues to minimize the impact. These strategies will enable organizations to overcome supply chain bottlenecks and improve overall efficiency.

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Nikhil Sonawane

Nikhil Sonawane is a Tech Journalist with OnDot Media. He has 4+ years of technical expertise in drafting content strategies for Blockchain, Supply Chain Management, Artificial Intelligence, and IoT. His Commitment to ongoing learning and improvement helps him to deliver thought-provoking insights and analysis on complex technologies and tools that are revolutionizing modern enterprises. He brings his eye for editorial detail and keen sense of language skills to every article he writes. If he is not working, he will be found on treks, walking in forests, or swimming in the ocean.

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