When will supply chain issues be resolved?
To be sure, without a crystal ball, no one can accurately predict when the challenges that have plagued the Global Supply Chain for the past 12+ months will subside. Take clogged ports, limited transportation capacities & available working hands, then combine that with the ever-increasing cost of products and anything & everything associated with moving freight around the world and it’s just a mess out there.
Solutions To The Global Supply Chain Crisis
So how to successfully navigate all of this nonsense becomes the overarching question that so many industries are searching for answers to. As we’re uniquely positioned to offer some battle-tested solutions, we’ve put together a short list of some best practices that may help you weather not only the current challenging landscape, but maybe even help us together operate more efficiently when we can all put this behind us.
1. Do Blanket Orders: Less Burden, Better Pricing
(And only now does the title makes sense.) Understanding that unique requirements of certain products can make it difficult to accurately forecast needs, try to look for those items in your spend that come up often enough that it might make sense to issue your supplier a Blanket Order to cover multiple purchases/releases. If your supply partner has a robust ERP System, they should be able to help pull together detailed order history to help identify some areas where it makes the most sense. Blanket Orders take a great deal of burden out of the supply chain and you may even find that manufacturers are willing to offer a discount (a what??) due to the relative ease of managing a single blanket PO, versus entering multiple orders for repeat items and then scrambling for “better dates” each and every time the product is ordered. Another benefit is that manufacturers may be willing to lock in “today’s” price in order to ensure some loyalty for a stated period. Be sure to have agreements in place with all parties concerned to discuss what should happen if the product was no longer required for any reason during the length of the contract.
2. Set Plan B (and maybe a Plan C & D): The Advantages Of Supplier Networks
If you’ve been relying on a sole source for your critical material demands, there is a good chance that you’ve been working with a very good & trusted partner for many years. They’ve been there for you every time you needed them; you may even know a little about their families, their hobbies and their goals, both professional & personal. However, Supply Chain Issues do not discriminate – it’s affecting everyone. Today’s business climate is making many great suppliers look merely good, good suppliers average and average suppliers simply awful. Having a backup plan in place is essential in order to avoid, or at least mitigate, costly interruptions in production & delivery. (To be honest, like many others we have learned the hard way. We’ve had to at times scramble to find alternatives for some items within our own production that we had single-sourced for so many years.) As always, the most sensible time to look for an alternate plan is when it’s not needed.
3. Have Constant Communication:
We’ve always found that our top On-Time Performance metrics are with those customers that we have the most effective open and honest communication with. This is no coincidence. If your project’s timeline slips, let your supply partner know the updates so they can accurately expedite to realistic timelines. What about when things don’t necessarily follow the script? Yelling and screaming will nearly always be counter-productive. Rather, roll up the sleeves, discuss some alternatives/best options and mutually agree at an acceptable Plan B. Most of us can recall projects of the past that have gone bad, but as sideways as they’ve gotten, it’s very likely that it was highly effective communication that led to the most desirable outcome.
Discuss And Be Proactive About The Known Supply-Chain Impacts
In early conversations with both Customers and Suppliers, talk about the “what-ifs?”. If an ocean shipment can no longer meet the timeline and it has to be shipped by air, who is supporting that financially? If the product specified is not available when it needs to be there, what are the opportunities to find an equivalent product? What is the financial impact of having to cancel an open order that gets pushed out? While the questions vary by situation, much of it boils down to communication. Please do your best to be available to your supply partners just as you would your customers, and always know that the best partners are unequivocally vested in your success.
Control The Flames
Like you, we look forward to a time when things look more like the past than the present. Early 22? Late 22? At some point even later? That’s really anyone’s guess, but whenever that “normal” returns and however it looks when it’s here, it’s critical that during these unprecedented times, we all work together communicatively & transparently to ride this out as best we can. In the meantime, if you find yourselves needing a Plan B or C (a “D” even?), let us know. Along with that crystal ball, we have no magic wand either, but what we do have is a dedicated team of hard-working people that do their absolute best every day to always look like help.