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supply chain risk

Key Supply Chain Risk factors for Manufacturers

The globalization of businesses over the last decade and the manufacturing industry, in particular have made it imperative for executives and risk managers to reassess the risks facing their organizational processes and their supply chain activities. Effective supply chain risk management in manufacturing companies is often hindered by factors including supplier failure and non-traditional risks. Furthermore, supply chain vulnerability is also increasing due to risks including supplier relationships, manufacturing process, and shipment of finished goods. While creating a supply chain risk management for companies in the manufacturing industry, manufacturers must also consider some of the below mentioned factors that are sometimes out of their control.

Is the absence of an effective supply chain risk management strategy increasing your vulnerability to challenges? Request a free proposal to know how Infiniti’s solutions can help you overcome this.

Top supply chain risk factors for manufacturing companies

supply chain riskDisruptions in distribution

When a key supplier moves their operations to another country, it can have a significant impact on the cost of production and raw materials for a manufacturer. Supply chain risk managers must ensure that regular communication and the presence of strong contract between value parties to prevent such unforeseen contingencies.

Laws and regulations

The degree of supply chain risk faced by a manufacturing company can be greatly affected by the changes in laws and regulations. For instances, if the wage laws and overtime regulations in a particular region changes, then it may eventually result in increased costs.

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Market competition

There’s a growing concern with mergers and acquisitions (M&A) of big companies across industries. These M&As have the potential to create monopolies, allowing organizations to eliminate competition and make it harder for smaller companies to survive. Market competition is also continuously changing and innovating. As such, organizations must decide which modern technologies and processes to adapt or risk falling behind other agile movers in the market.

Labor issues

When a workplace is unionized, it becomes difficult to adjust employee contracts as and when required. For example, laying off employees may prove to be tough during periods of low customer demand or relocation of assets. Adequate training must be given to employees in order to maximize productivity and reduce risks. Manufacturers must also take measures to ensure that in case of any employee’s absence, the production process is not disrupted.

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supply chain challenges

Top Supply Chain Challenges Facing CPG Companies

The Consumer packaged goods (CPG) industry is already experiencing a seismic change due to challenges including rising raw material costs, stalled demand, declining profits, skyrocketing retail pricing pressures and the never-ending shift in consumer preferences. Furthermore, the changing consumer preferences is bringing about new supply chain challenges for CPG companies. Companies selling consumer packaged goods must effectively identify and mitigate supply chain challenges coming their way in order to drive growth by reaching new customers and channels.

Leaders of consumer products companies need to strike a delicate balance between cost, quality, product innovation, and market growth, all while maintaining margins. Request a free proposal to know how experts at Infiniti can help you achieve this.

Supply chain challenges for CPG companies

supply chain challengesConsumer demand for variety

Modern consumers are highly demanding. As a result, there is a constant urgency among players in the CPG industry to offer new products that match the changing consumer preferences. This translates to more SKUs and shorter product lifecycles. Th consequent complexity in product development, sourcing, production and fulfillment will add on to the supply chain challenges faced by CPG companies. Reacting to changes in consumer preferences would mean that the CPG supply chain needs to be agile enough so that the required adjustments can be orchestrated end to end across the supply chain.

Venturing into new markets

Experts at Infiniti research are of the opinion that the fastest growing CPG companies are those that choose to compete in the fastest growing product categories and geographic territories. Investing in the right markets is one of the key drivers for growth, which comes with its own set of supply chain challenges. Furthermore, overcoming key supply chain challenges in terms of flexibility will help companies in the consumer packaged goods industry to easily penetrate new markets and create potentially new delivery models and fulfilment channels.

Get in touch with our experts for more insights on how CPG companies can overcome critical supply chain challenges.

Digital transformation of supply chains

Amidst the rising popularity of digital innovations and enhanced customer experiences, it is no surprise that digital transformation is one of the critical agendas for top executives at leading global CPG companies. However, this cannot be rolled out successfully unless their back-end infrastructure is not capable enough to ensure timely delivery of goods.

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Logistics management solutions

Realizing 37% Savings in Operational Cost for a Retail Company – Infiniti’s Logistics Management Solutions

Logistics Management Solutions for a Retail Company

Despite recent advancements in technology and shipment tracking systems, companies in the retail industry are facing challenges in efficiently managing supply chain processes. Indeed, today’s competitive retail marketplace necessitates retail companies to accurately forecast the product demand to enhance logistics & supply chain management.

Are you finding it difficult to accurately forecast the market demand and manage inventory requirements? Our logistics management solutions can help. Request a FREE proposal!

Business Challenge

The client is a retail supplier based out of Denmark. Due to the inconsistent nature of the product demand and capacity planning process, they were facing difficulties in managing their inventory stocks and ensuring timely delivery of products. Also, the client relied solely on historical patterns of demand to plan for the production process. Consequently, the client witnessed a huge dip in their sales rate and this subsequently affected their overall profits. To optimize their production planning process, the client approached the experts at Infiniti Research to leverage their expertise in offering logistics management solutions.

Other key objectives that the client was looking to achieve by leveraging Infiniti’s logistics management solutions were:

Enhance inventory visibility and metrics – Due to lack of inventory visibility, the client faced challenges in planning their production and distribution process. This further increased the storage cost for the company by 2x. Therefore, with Infiniti’s logistics management solutions, they wanted to analyze the demand patterns and enhance their inventory visibility.

Build a reliable order fulfillment process – The company’s unreliable order fulfillment process often led to shipment delays, thereby increasing customer churn rate. To tackle this challenge, the client wanted to streamline their order fulfillment process with the aid of Infiniti’s logistics management solutions.

Managing reverse logistics – By leveraging Infiniti’s expertise in offering logistics management solutions, the client wanted to implement sound reverse logistics framework and efficiently manage the product return process.

With over 15 years of expertise in offering logistics management solutions, we can help you enhance your inventory visibility and better manage production processes. CONTACT US today!

Solutions Offered

As a part of the logistics management solution, the experts at Infiniti Research conducted an inventory forecasting engagement. This phase of Infiniti’s logistics management solutions helped the client to thoroughly analyze the market demand and identify target stock levels to meet the rising demand for products.

Infiniti’s logistics management solutions also involved demand planning and forecasting. Our demand planning and forecasting solution helped the client to enhance the accuracy of their demand forecast. This further helped the client to improve production capacity and optimize their supply chain operations.

Lastly, the experts conducted retail market scanning and monitoring. This phase of Infiniti’s logistics management solutions helped the client to keep pace with all market transformations in the retail industry. By doing so, the client was also able to better manage their inventory by understanding demand fluctuations in the retail market.

Results Obtained

With Infiniti’s logistics management solutions, the client was able to enhance the accuracy in demand forecasting by 25%. Also, the logistics management specialists at Infiniti Research helped the client to implement reverse logistics management framework to efficiently manage the product return processes. Also, enhanced inventory visibility helped the client to better manage logistics requirements and timely deliver products. As such, the company realized a 37% savings in operational cost.

Request for more info to know how our logistics management solutions can help your company to enhance the accuracy in demand forecast.

IR24

Top 4 Strategies Retailers Must Follow for Better Reverse Logistics Management

Reverse logistics management is a multilayered and nuanced process that presents a manufacturer with several challenges including tracking routing status and warranty, beefing up analytics, analyzing target market, handling suppliers and contractors and driving efficiency in repair processes. Market size analysis for any reverse logistics process has become even more challenging due to rapid growth in the number of customers and their rapidly changing behavior.

If the target market is not analyzed properly, reverse logistics management fails and businesses fail to provide customer satisfaction. Additionally, it increases resource investment levels and storage and distribution costs. Therefore, it is important for the reverse logistics businesses, especially e-commerce, to understand that with the increasing volume of returns, they need to have a proper market analysis mechanism in place.

At Infiniti Research, we understand that better reverse logistics management can act as a sort of asset recovery for manufacturers, so they can extract as much value from the product as possible, providing the second return of investment. And to help companies in careful market size analysis and better reverse logistics management, our team of experts has highlighted four best strategies that can help market players to become global leaders.

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Strategies for Better Reverse Logistics Management

Strategy #1: Adopt new repair and return policies

With retail facing an immense number of returns today, generous return policies have become a competitive necessity. Retailers are also taking better and more steps to reduce the abuse of those policies like Amazon customers who have returned too many items have had their accounts closed without any warning. Both retailers and manufacturers also need to empower customer service associates to make returns more efficient.

Strategy #2: Better collaboration with retailers

Manufacturers and retailers need to take a closer look at their vendor agreements. While the price has often been a matter of dispute, many are re-evaluating their policies of return. For big products like furniture and electronic items, returns are a major issue. So, good collaboration between the supplier and retailer is the need of the hour for better reverse logistics management.

Strategy #3: Optimize your reverse logistics process with data

Manufacturers and retailers both should look for new platforms and third-party partners to sort, resell, process or dispose of items to have better reverse logistics process. With the help of data, return processing becomes cheaper and partners can easily liquidate and handle the inventory. Many manufacturers are now using sensors, IoT, and connectivity to monitor, troubleshoot or repair products in the field and minimize the need for consumers to send products back. Also, they are designing their connected products with software and operating systems that can be trouble shooted or updated from anywhere. Some of the manufacturers and retailers are also using easy-to-replace components and hardware that can be sent to consumers for self-repair. Data they track can include the condition of the products, the volume of returns, and the reason for return along with the percentage of sales.

Strategy #4: Rethinking transportation and logistics

One strategy that suppliers can use today for better reverse logistics management and to reduce costs and improve efficiency is to combine delivery and pickup. With the increasing number of consumer purchasing online, the volume of returns has increased. It is likely that firms in the logistics industry will need to address the growing number of returns by finding drains where they can resell slow-moving and returned product.

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