Community//

Supply Chain Mistakes Most Businesses Make

The supply chain is one of the fundamental areas of business, which is pivotal for success. Most companies lay great emphasis on product designing and manufacturing, the next thing that comes around is marketing, but they fail to properly devise and execute an effective plan and strategy for the supply chain and distribution.

Supply Chain Mistakes Most Businesses Make

It is a department where the margin of error is very limited and consistent, systematic failure can potentially drive you out of the business before your products and supplies are driven to the point of sale. Business leaders have opted for a number of strategies which have worked wonders for others. In addition, there are a set of mistakes which can be regarded as the nuisances which every business should avoid. Here is an overview:

Not getting your cost-to-serve right – In the supply chain, cost-to-serve is integral to your business performance. However, most organizations have a remote understanding of it and simply overlook it. Questions like understanding which customers contribute to the most profits and which lead to losses; customers which yield zero profit; products that are being supplied to customers at a loss. Most business leaders do not have an answer to these questions and it ultimately leads them to failure. This is because companies do not generally get in depth and run exercises to get a grip on the costs involved in the supply chain.

Partnering with the wrong ones – Outsourcing is a popular trend and partnering with the wrong partner means failure. It is important to partner with only the most reliable partners, such as Transmed, an Africa-based Supply Chain and Distribution giant that caters to a large group of FMCGs. Transmed’s success translates to the success of their clients and they run an all-rounded supply, logistics and distribution model for the food industry and consumer brands with top-notch logistics mechanism and management. Some of the brands in their portfolio are Colman’s, Wrigley’s, Knorr, Lipton, Skittles, Mars, Ariel, Gillette, Duracell, Oral-B and many more.

No customer service – Many companies do not pay attention to the complaints and reviews that they get from customers. The logistics team fails to comprehend the valuable insights that they can learn from the feedback of customers. Plus, any mishandling or disgruntled customer can cause a bad impression on the business. If there is mismanagement or some problem occurs during freight service, it is top-tier customer service that mitigates damage and reassures the trust of the customer.

Working out inaccurate forecasts – This is another area where problems occur. Preparing wrong forecasts of revenue leads in distribution and the external factors such as the weather and law and order situation which can have an impact on the business. Getting your facts wrong can ultimately cause many problems for the business.

The Thrive Global Community welcomes voices from many spheres. We publish pieces written by outside contributors with a wide range of opinions, which don’t necessarily reflect our own. Learn more or join us as a community member!
Share your comments below. Please read our commenting guidelines before posting. If you have a concern about a comment, report it here.

You might also like...

Money coins stack growing graph and piggy bank nature background, business concept.
Community//

5 Simple Ways to Improve Your Profit Margins

by David Finkel
Community//

Reasons for the Failure of Startups

by Nirdesh Singh

Sign up for the Thrive Global newsletter

Will be used in accordance with our privacy policy.

Thrive Global
People look for retreats for themselves, in the country, by the coast, or in the hills . . . There is nowhere that a person can find a more peaceful and trouble-free retreat than in his own mind. . . . So constantly give yourself this retreat, and renew yourself.

- MARCUS AURELIUS

We use cookies on our site to give you the best experience possible. By continuing to browse the site, you agree to this use. For more information on how we use cookies, see our Privacy Policy.