Here’s How Manufacturers Can Improve Supply Chain Resilience NOW
The COVID-19 pandemic has highlighted even the most minor vulnerabilities in the modern supply chain — and supply chain executives are taking every precaution to ensure that for the next great black swan, their supply chain resilience is improved.
Supply Chain Resilience and Agility Is Critical
This fact is made clear in a new global study conducted by Gartner that surveyed over 1,300 supply chain professionals. According to its findings, 87% of respondents indicated that they plan to invest in supply chain resilience in the next two years. Additionally, an incredible 98% of respondents said they are planning to invest in supply chain agility.
“Supply chain executives overwhelmingly recognize the necessity to make their networks more resilient and agile. At the same time, 60% admit that their supply chains have not been designed for resilience, but cost-efficiency,” said Geraint John, vice president analyst with the Gartner Supply Chain practice. “The challenge will be to create an operating model for supply chains that combines the best of both worlds and also delivers supreme customer service.”
There are several ways a manufacturer can pursue these initiatives. One is through the incorporation of advanced robotics and automation opportunities, which can help strictly enforce social distancing measures while improving overall efficiency, productivity, and storage density. Another solution would be to slowly adopt a more diversified and regionalized supply chain model, which would help reduce reliance on key suppliers concentrated in specific parts of the world — a fact that can cause significant disruption in the midst of a global economic slowdown like the one being currently experienced.
The issue, of course, is a matter of cost. Most large scale supply chains, for example, are so heavily integrated into a global just-in-time inventory network that it might prove too much of a regulatory burden to make such a transition easily. And any venture into automation is going to require a significant financial investment that can be unmanageable in a booming market, let alone one that necessitates cost-cutting measures in order to remain solvent.
Start With an Inventory Management Solution
Partstat inventory management solutions represent a strategy that manufacturers around the world can implement and see an improvement in resilience immediately. Instead of operating on a strict just-in-time inventory model, users of an inventory management solution allow Partstat to step in and purchase any inventory necessary to complete the lifecycle of their product on their behalf. The benefits of this strategy include:
• The manufacturer retains all of their working capital, allowing them to invest in initiatives that maximize ROI.
• The manufacturer avoids all major sources of supply chain disruption, including extended lead times and obsolescence-based issues. All inventory will be stored in Partstat’s best-in-class warehousing facilities and will be packed and shipped anywhere in the world as needed.
• The manufacturer avoids any inconveniences that result from increased market volatility such as rapid price inflation. Purchasing large quantities of inventory upfront in the production process locks in today’s price, and in some cases, also opens up the potential for significant bulk-purchase discounts.
• Many manufacturers use Partstat inventory management solutions to take care of any unexpected last time buys that may become necessary, allowing them to maintain their working capital.
• Partstat’s inventory management solutions have been proven to save manufacturers up to 42% in annual carrying costs, all while reducing days on-hand inventory.
Manufacturers in industries ranging from aerospace to healthcare to consumer electronics have all taken advantage of Partstat inventory management solutions. The type of inventory needed has no restrictions, nor are there restrictions in regards to inventory quantity, price, or storage term limits.
If a customer needs it, Partstat can buy and store it — and their supply chain will immediately become more resilient as a result.