In 2021, as businesses bounce back from the pandemic, organisations are beginning to explore new markets again. However, that first foray into a new market can be hugely demanding – taking up valuable time and resources within internal teams. In fact, with so much going on in the day-to-day running of the modern business, putting time aside to assess the efficiency and accuracy of a supply chain can sometimes feel impossible.
So what are the most pressing procurement challenges that managers have to deal with and what can be done to make logistics procurement a seamless process?
Logistics management and supply chain effectiveness
1. Cost control
The first consideration for any organisation when making any procurement decision unsurprisingly revolves around the financials. What is the initial outlay and what are the ongoing costs? At 7bridges we use AI technology to analyse data across entire supplier networks with a focus on identifying cost savings and performance gains. By cutting through the challenges of establishing a distribution network and prolonged contract negotiations, our intelligent logistics platform makes it possible to procure the right services at the right price when a business decides to enter a new market or add a new lane. By developing data-driven RFQs using cutting-edge technology to analyse and simulate the impact of supplier proposals, our clients are able to build new networks in next to no time.
2. Managing risk
While it is never possible to completely eradicate risk from ambitious expansion plans, it is possible to cut through some of the challenges that present themselves when establishing new agreements within a supply chain.
Research from IBM found that, across industries, a third of all supply chains fail to manage risk on a formal basis. The automotive industry in particular was guilty of this, with 37% acknowledging that they had no formal practices for monitoring risks. Risks can come in all shapes and sizes: delays due to adverse weather, border closures, cyber attacks on suppliers or even their financial collapse. And, of course, unexpected events like the blockage of the Suez Canal in Spring 2021 can always present unwelcome surprises.
Again, this is where 7bridges excels and offers valuable peace of mind to organisations. 7bridges’ AI is constantly monitoring your network, and makes it possible to automatically switch suppliers whenever there is a change in your ecosystem. So, if a carrier goes down, a warehouse goes offline or a border is closed, the supply chain rapidly adapts to ensure that disruption is kept to a minimum and your business continues to run smoothly.
3. Building lasting relationships
Many organisations establishing a new supplier relationship enjoy the benefits of a honeymoon period, where nothing is too much trouble and solutions are quickly made available. But to maintain an effective, long-term relationship with a logistics provider requires transparency and consistency. A trusting supplier relationship is one built on clearly defined contracts, a solid working framework and data-driven performance management.
A powerful software solution like 7bridges can help to ensure that not only are businesses forming efficient new relationships with other organisations, but also ones that will endure into the future.
Situations like the COVID-19 pandemic have taught organisations across all industries the value of supply chain logistics. Data sourced by RetailNext showed that almost two thirds (64%) of retailers were challenged to adapt their supply chain for ecommerce, and this becomes much more difficult in situations where supply chain operations are unclear. Being agile enough to adapt or pivot a supply chain when money is tight and the ecosystem is constantly evolving can demand resources that you just don’t have. This is when the efficiency and accuracy of AI-powered logistics management truly comes into its own.
The importance of supply chain management
A big part of managing your supply chain is finding solutions to the practical issues you face in getting your products to your customers. Who will be your logistics service providers? Where will your products be stored? How will they be transported? If by shipping container, can you provide the necessary legal documentation to meet the demands of relevant import and export controls?
This can be demanding, but utilising your supply chain to the best of its ability is vital in ensuring you get the best possible results from your business. At 7bridges, we identify ways you can reduce costs and improve efficiency in your supply chain, without meeting resistance . Through our consultative sales process, we can ensure that our intelligent logistics platform plans your network and procurement process precisely as you need it – sourcing the best suppliers (at the best rates) for your needs. We can help you execute your logistics by automating your inventory management and shipping processes. This enables you to manage your supply chain effectively, with greater transparency and reduced risk.
Learn about the 14 steps to excel in logistics procurement, in this handy guide.
