The coronavirus pandemic has affected practically every aspect of how companies operate, especially in terms of supply chain management. Ensuring that your own supply chain remains active, responsive and capable of timely delivery can be a challenge at the best of times, never mind when it needs redesigning around the constraints put in place by COVID-19.
Many British businesses use China in their supply chain. This initially makes perfect sense, as the cost of products can be much lower than when sourced locally. However, unit price isn’t the only factor in play, as you also need to incorporate the figures associated with international shipping, as well as the storage of large quantities of inventory due to bulk ordering. Compounded with huge increase in shipping costs. Containers have seen a rise over 100%!
Once all of these costs have been accounted for, the product usually ends up being more expensive than if you had bought it from a UK supplier.
None of us know how much longer the pandemic will continue its effects on the global supply chain network. Countless businesses have already suffered lengthy delays and lack of availability of essential supplies, causing huge disruption to their day-to-day operations. Even when the pandemic has ended, many British companies are currently reassessing their supply chain and planning for long-term efficiency by changing how they order products and supplies.
When your business purchases items with a higher unit cost but lower overall cost from within the UK, saving money is only one of the benefits. In the process, you’re also fuelling the British manufacturing industry, safeguarding jobs, supporting the wider UK economy, and significantly reducing your company’s carbon footprint through shorter transportation routes. Chances are the items will also be with you faster due to much closer proximity, making strict lead times more achievable.
Just as crucially as all of the above, buying from suppliers within the UK offers direct communication and higher levels of product quality. Thanks to the supplier being within the same time zone, working to shared regulations, and the language barrier being removed, you can manage your supply chain much more effectively.
The principles of Lean management have been applied to supply chains to great effect for many years. The focus is on agility, efficiency, consistency and quality, which are made possible by sourcing materials from suppliers that are closer to home. Whilst removing the supply chain delays, this also gives a business the opportunity to reduce quality issues and fine-tune its own offering.
Changing your supply chain to low-risk economies also removes the interference caused by unpredictable factors, such as industrial action, war, natural disasters, and of course the possibility of future pandemics.
When you source in smaller quantities from suppliers that are nearer your site, you also gain the ability to apply Lean principles that would otherwise be impossible. Prime examples include Just-in-Time, Smaller Batch Sizes, Production Levelling, Creating Pull, and other positive actions that will reduce lead time and optimise the way you do business.
Our mission is to reveal the potential in your supply chain and deliver workshops in Value Stream Mapping. This gives your teams everything they need to make substantial savings across the business whilst maximising the quality of your products. We follow this up by creating a strategic plan, which ensures that your company is COVID-proof and can successfully maintain operations in line with your vision, mission and customer demand.
We’re a team of visual management and Lean management specialists who help businesses to remove constraints and achieve operational excellence. To find out more, get in touch on 01482 296451 or fill in our contact form.
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