2012-07-26 00:00:00 Money & Finance English https://d3hrajprm8dqcv.cloudfront.net/wp-content/uploads/2017/05/08195541/July19_Supply-Chain-Management1.png Supply-Chain Management for Small Businesses

Supply-Chain Management for Small Businesses

2 min read

World over, businesses are saving millions of dollars in costs and decreasing inventories while improving efficiency and customer satisfaction with effective Supply-Chain Management. Can it be applied to small businesses and start-ups too? Supply chain has been defined to be ‘the movement of materials as they flow from their source to the end customer’. Essentially, it includes: • Purchasing of raw materials • Manufacturing the products • Warehousing the finished product • Transporting the product to retail outlets For effective functioning of all the above-mentioned components, supply-chain management also includes demand planning, supply planning and customer service. Can Small Businesses benefit from Effective Supply-Chain Management? Yes. Small businesses can take advantage of a well-drawn out supply chain strategy for following reasons: • Small businesses are very flexible. Mostly, they are still very young and developing and hence, are willing to re-engineer existing processes. • Being small, they are integrated in nature whereby various business functions are usually performed by one or a few persons working together. This makes decision-making faster. Ways to Strengthen your Supply-Chain: Being a small business, you might not have the required clout or power to enter into strategic partnerships or even tap those outstation sources with temptingly low cost of raw materials. However, this shouldn’t stop you for aiming for a seamless supply-chain strategy. • Track all your materials and ingredients: Track all your materials and ingredientsin the manufacturing process, find out their sourcing details and evaluate them further in order to get the best quality at the minimum cost with safety being a priority. • Identify key components and risk points: Study your supply-chain thoroughly to check for key components and risk points. This will give you visibility on the ingredient/process that can bring the production to a grinding halt. Similarly, the risk points will enable you to be prepared with contingency plans. • Complete Participation: Your efforts to have a cost-effective supply chain management will not be successful until you take the buy-in of your employees, train them adequately to handle the operations without any hitch and empower them to take business decisions. Once you are in control of your supply chain, you will discover that it has proved beneficial not only to your production process and people, but also your sales and marketing efforts. Remember,customers today are spoilt for choice and are passionate about product quality and safety. Therefore, reinforce the benefits of supply chain management in your business highlighting the profitability and marketability that comes with quality, and see yourself grow faster.

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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