This year has presented a steep learning curve for global supply chain sites, as typified by the dramatic disruptions to supply chains caused by the COVID-19 crisis. By Danielle Dadello.
In March, metalwork manufacturers across Australia who rely on overseas suppliers for their materials saw drastic supply shortages, and many manufacturers and food processors waiting on materials or ingredients have had to make the difficult decision to put their businesses on hold. As a result, this places enormous pressure on the supply chain.
Globalised supply chains require globalised visibility
Manufacturers and suppliers providing services and stock to businesses such as food processors face a lot of pressure and responsibility, propping up the smooth running of producers’ ability to provide goods for end-of-the-line consumers. For example, food manufacturers utterly depend on the smooth running of the supply chain, but all too often relationships with suppliers can be problematically complex and unclear.
Globalisation and complicated supply lines mean that some manufacturers and supply chain sites might be in risky and unreliable supply chain relationships without even knowing it. This can mean supply chain sites tasked with receiving and delivering goods and services can unexpectedly become affected by international crises, much like COVID-19, without the means to properly address and overcome this.
Even in the case of less dramatic but nonetheless critical issues like product recalls, manufacturers can be held accountable for any improper product handling and poor management performed by the suppliers of materials and components earlier on in the supply chain. Enhanced insight into supply chains from the very first source is essential for manufacturers to have greater visibility into all ingredients sourced and used in production, to significantly minimise recalls due to incorrect or missing labelling, and on a greater scale, get ahead of international crises, and safeguard business performance against supply chain issues.
Many manufacturers are using cloud-based technology to gain this critical, business-bolstering insight. Having complete visibility over your suppliers, materials, and all points of production means you can know where your goods are at all times, and ensure nothing gets changed or compromised along the way. It also means the goods you pass along to your customers will be the highest quality they can be.
Bolster yourself against risks
With enhanced visibility into suppliers, it’s essential you identify supply chain characteristics that seem risky and address them head on. With healthier supply chains, manufacturers can be better supported and far more resilient in times of uncertainty, or when supply chain sites fail.
Building strong relationships with your suppliers is essential to abate risk, and establish productive systems of trust – trusted relationships where you can truly rely on your suppliers to provide quality goods, so you can then do your best work. Strong relationships are also critical in multi-supplier strategies, which manufacturers should consider exploring for trusted back-ups and support when primary suppliers can’t provide. Establishing supplier relationships in different countries and regions means that if one supplier falls due to political, economic or environmental events, you can draw on unaffected suppliers to keep business running.
It’s also best to identify risky supply chain characteristics and cut them as soon as you can. For example, relying on suppliers in low-cost countries can leave manufacturers at a higher chance of receiving low-quality goods, forced to wait out delays, or seriously affected if that supplier goes under. It’s essential to review any suppliers’ track record too, and ensure they’ve consistently met demands and quality standards with their customers.
In today’s globalised and digitised world, best supply chain practice comes down to implementing technology. Technology tools like cloud software is the only way suppliers and manufacturers can gain truly accurate, real-time visibility across all their stock and goods.
Customer communication
For companies in metalworks and production, keeping customers happy is a must. In uncertain, challenging times like this, it’s more important than ever that your customers understand that, as much as they rely on smooth running supply chain processes and product deliveries, so do you. When product recalls or unexpected events like COVID-19 strike, suppliers need to communicate clearly and openly with customers. Customers will appreciate you conveying the reality of hold-ups and offering more realistic timeframes around when services and products will be available, so they’re not left in the dark and can make decisions about their own business operations. It’s important that these timeframes are based on data-driven, real-time insights gleaned from smart technology, so they’re accurate and legitimate.
Talking to key stakeholders in your customer base can also help you better communicate next steps and showcase that you’re invested in each customer’s wellbeing. Chatting to heads of finance, growth, or product can help you tailor communications to each part of customers’ companies, and keep specific sectors informed. Customers will appreciate this comprehensive approach.
Moreover, if stock and goods are held up, see how else you can support customers. Perhaps there are other services or products that you can provide at this time instead. This works to keep customers satisfied, before they start searching for different products.
Whether it be metalwork, food production or other manufacturing sectors, manufacturers are facing significant supply chain challenges as disruptions leave goods and resources held up overseas. It’s critical that in crises like this, manufacturers can continue to cater to their customers, and work on strengthening their supply chain relationships and practices to ensure best practice in the future. A globalised and highly complex line, the supply chain can be vulnerable at the best of times. Now more than ever, manufacturers of all kinds need to prioritise supply chain technology, gain visibility into their goods and protect themselves.
Danielle Dadello is a Country Manager at Unleashed Software