Remember how the supply chain disruptions were supposed to be all fixed and in good order 6 months ago?
Now, it appears as though we have a more disrupted supply chain than ever.
Many products simply won’t make it to the United States. Or, if they do, they’ll be sitting in port for months before they can make it to your shelves.
You’re already paying a massive premium just to get product here.
So, how do you deal with all this chaos…and especially so when it has no end in sight?
Fortunately, our economy itself is healthy and consumers are happily spending.
Here’s what you can do to make the best of a wildly out-of-control supply chain:
1. Pass Costs on to Consumers
The situation really is getting this dire. These supply chain conditions are easily as bad as they have ever been.
Inflation is on the rise. And the disruptions have no clear end in sight.
To some degree, you’ll have to raise your prices. You simply have no other choice.
But it shouldn’t be a competitive disadvantage because everyone is having to do it.
2. Monitor Data to Improve Visibility and Increase Agility
Leading technological research firm Accenture recommends having the systems in place to monitor your entire supply chain.
You don’t know which products will experience shortages or when. Your own cash flow will be disrupted.
So, the next best thing you can do is monitor the situation as closely as possible so you can quickly respond.
3. Build Resiliency in Your Supply Chain
It takes more time and effort to manage low-volume purchases from many suppliers. Plus, you can’t negotiate pricing in your favor with nearly as much success.
So logically, it only makes sense to switch over to larger suppliers where possible.
In addition, you’re wise to have multiple sourcing options for the same product, just in case you experience a disruption with one of your larger suppliers.
You’re also smart to have these supplier relationships in place in multiple countries. The US-China trade war, for example, gives you ample motivation for doing this.
You may need to engage a consulting firm for help in this process.
4. Capitalize on An Opportunity for Innovation
An article at Harvard Business Review notes that any time you make a major business change, and especially now, is really an opportunity to innovate.
For example, the article discussed the story of a new Chinese factory for producing American industrial equipment being built.
It started by using contemporary US and Japanese factory designs. But it improved and operated with far greater efficiency than those factories because it decided to use new equipment and new ways of working.
How can you innovate within your supply chain? And how can you work with your suppliers to innovate to uncover new opportunities for growth?
It’ll continue to be challenging to operate in the months and years ahead. Researchers believe COVID will affect the world for years to come. And we may never return to a pre-pandemic society.
But you can survive and thrive by using these tips as inspiration.