If you’re running a company, you know that your supply chain makes a huge difference. If you have a reliable one set up, you can get the raw materials you need to create your products. If you have supply chain issues, though, your business likely can’t function.
Before we can discuss a typical supply chain solution list you might encounter in 2023, we should first go over some supply chain issues that hinder company effectiveness. We’ll do that right now.
What Are Some of the Most Common Supply Chain Issues?
If you run a huge company, you might have a logistics manager. These individuals expertly oversee supply chains. They look at your operations, purchasing, shipping, and so forth. They’ll know all the logistical challenges that your supply chain faces.
If you ask them about those challenges, they might bring up raw material shortages. They may say you face some port congestion with ships bringing your supplies. They might mention dwindling warehouse space if you have soaring orders. They may also say you don’t have enough skilled employees to handle the business’s supply and demand side.
We’ll talk about how you can handle each challenge in turn.
Raw Material Shortages
Raw material shortages can cripple a business. During the pandemic, they become a huge problem. Some companies discontinued products. Others shut down entirely, and they never got back on their feet. Still others shut down for a while, and now they’re gradually coming back with loan money or fresh cash infusions from various sources.
Raw material shortages still happen sometimes, though, and they’re not necessarily pandemic-related. Just about anything might cause one. The fact remains: if your company does not have the raw materials for its products, you can’t fulfill your orders.
If that happens, you might lose clients. They’ll use another supplier if you have a competitor still making the same products, or something similar. You must look at alternate solutions. Maybe another country can get you the required raw materials.
For instance, if you need a particular fabric, and it’s coming from China, you might look at Indian supply sources. If only one country or region has the supplies you need, you must discontinue that product, at least temporarily. You might conduct employee brainstorming sessions regarding other products you may produce that can serve as a stopgap.
If you have ships bringing your company supplies through ports, and congestion takes place, you can tell your clients you will get them the finished products they want, but it will take more time than usual. They might not like that, but if you have a long-term relationship, they may grant you more time.
You can also use alternate shipping methods. If you can’t bring in what you need by sea, bringing it in by air makes sense. If you can use planes, do so. You might also look at other ports if any exist.
Not Enough Warehouse Space
Dwindling warehouse space sometimes means you have more orders coming in. You might have too many products because you can’t move them out fast enough, though.
If that happens, you should use alternate shipping methods. You can hire additional trucks or other vehicles you might use for transportation.
Maybe you don’t have enough warehouse space because you see reduced product demand. That is a different problem and potentially a more serious one.
If you have too many products and you’re sitting on them in your warehouses, you must figure out how to move them out fast. You’ll develop a backlog, and you must halt production till you move what you already have.
You might move the products by offering them at discounted prices. Maybe you can’t get the revenue from retail outlets that you usually would, but if you can make a profit or break even, that might work till product demand increases.
You can also offer brick-and-mortar stores your products that don’t normally carry them. Discount outlets often buy discounted products if you must move them fast. You won’t get the money you usually do, but you’ll get enough to remain operational.
Not Enough Skilled Workers
If you have the raw materials you need in your supply chain, they’re moving with no issues, and you have enough warehouse space, you’re doing well. You might run into an additional problem, though. You may not have the skilled employees required to keep the whole operation moving.
You need individuals to harvest and ship the raw product materials. You need workers who can operate
the ships and trucks that get you those raw materials. You must also have warehouse workers who can store and move the products when they arrive. You need drivers who will deliver the finished products where they are going.
You may not employ all these individuals directly. For instance, your company might not employ someone making glass beads in Thailand to sew onto the children’s dolls you make. You can’t hire someone for that company. You can just go with a different supplier if one exists.
You can hire new workers for every supply chain position that you directly control. Maybe that includes truck drivers if you own a truck fleet. It probably includes warehouse workers who can store and ship your finished products.
With all the potential supply chain issues we mentioned, a commonality exists. Maybe you have already noticed it. It is this: you can only take the actions that you can directly control.
In other words, you can go with an alternative raw material supplier, or you might hire additional workers if you need some warehouse help. You can’t make the ports move any faster if there’s backup happening there, though.
Once you accept that you can directly impact certain supply chain issues but not others, you should do better with logistical problems. You’ll feel relaxed, even when facing a business-related maelstrom. You can calmly analyze the situation, take a breath, then start moving toward the most reasonable solution.