If you are in the manufacturing business, one of the essential areas that you have to pay full attention to is the supply chain, especially if you source materials from international suppliers.
With fierce competition and the volatility of the world economy, the pressure to deliver products promptly and at a low cost is definitely there. Further complicating matters is the delicate nature of the supply chain such that when one link is broken, problems can abound.
As such, the challenge for your business is how to effectively manage your global supply chain. How can you achieve such a goal? Here are a few helpful tips.
Find a suitable partner
Wherever you may source your materials, it would be beneficial for your business to find a partner company which will act as an in-country representative in the form of a supply chain management consultant. Such a partner can provide a suite of services which will cover a wide variety of issues ranging from finding the right suppliers to taxation.
A suitable partner has extensive experience working in that country and preferably spends a substantial amount of time there.
The importance of sales forecasting
Sales forecasting will enable you to help you and your supply chain management consultant to anticipate how much of the necessary materials should be purchased, as well as what the buying schedule will be like. Take note that when you are shipping goods from overseas, this will take time. You need to have a clear idea of the demand for your products. Additionally, your consultant should always be made aware of your inventory data.
Get a back-up supplier
Despite your best intentions and efforts, there will certainly be hitches that can bog down your operations and adversely affect your business.
As such, it is a good idea to create redundancy by finding another supplier. Another supplier would suffice, giving your business ample cover while eliminating the hassles of managing more than one supplier.
Build relationships
Maintaining a healthy relationship with your suppliers can only be good for your business. By building goodwill with your partners, you can reap a few benefits including better terms and faster delivery. In order to achieve these, you have to make sure that you are prompt in your payments, give them slack for honest mistakes, communicate well and be flexible.
Look for local suppliers
Whether you are unprepared for the risks and challenges of sourcing from international suppliers or you are looking for an additional supplier, consider looking at domestic suppliers. Sometimes, local suppliers can deliver more quickly and require a lower volume of orders. They can also provide your business with the ability to respond quickly to changes in demand.