Making sure you have adequate inventory and that you can purchase it at a price that allows you to remain competitive with other businesses in your area is an important component of running a successful small business. Learning to manage your supply chain can help keep you stocked with the items you need at prices you can afford.
Supply chain management is essentially the adminsitration of a network of businesses that are interconnected and involved in the making and distribution of a product or service. Many large companies can exert a huge influence on their supply chains, even impacting how the components of the parts they sell are made and transported. Small business does not quite have that amount of influence, but small business owners can make supply chain decisions advantageous to their ventures.
By keeping careful track of your inventories, you can determine what you need and when. There are many great inventory-tracking software applications small businesses can use to keep detailed records on inventories so business owners can identify trends in product popularity, seasonal shifts and changing needs. By using this data, small business entrepreneurs can streamline their businesses to make them more efficient, not carrying an overstock of items and avoiding being caught short of seasonally popular items.
Information technology has had a variety of impacts on supply chain management beyond just inventory data, supply chain management software is also being used by many small businesses with international supply chains to find the most tax advantageous method of procuring and moving goods.
Small businesses can also keep costs down and reduce supply chain management problems by dealing with a limited number of vendors. By finding vendors who can meet a variety of needs, you eliminate some of the workload involved with dealing with multiple vendors – multiple invoices, multiple phone calls, etc.
If your small business is a link in someone else’s supply chain, you may do well to outsource the logistics of shipping and delivering your products to your clients. Outsourcing your logistics allows you to focus more of your resources on the core strengths of your business and can, in many cases, be more cost effective than running an in-house logistics department. The key is finding a company that can reach the links on your chain quickly and efficiently. When choosing a company to outsource to, small businesses would do well to find one with an existing relationship to links on your chain or who have substantial operations in the areas where your links are located.
By getting a solid grip on your company’s supply chain, you can cut costs and ensure optimal efficiency, allowing you to realize savings that you can pass on to your customers.
