5 Ways to Improve Your Supply Chain in 2023

The past few turbulent years have thrust supply chains into the spotlight and as a result, efficiency, resiliency, and scalability of the supply chain is a requirement. Attempting to improve your supply chain on all of these fronts can be a tricky and daunting proposal.

Supply chain optimization generally encompasses everything from sourcing raw materials to delivering finished goods to customers. The climate of the modern supply chain industry makes it more important than ever for companies to continually improve their supply chain operations in order to stay competitive.

However, changes and improvements don't have to happen overnight. Over time, though, changes can be made to improve your supply chain in various small yet highly impactful ways, one step at a time. 

Below are the five key areas that you should be paying extra attention to.

Leverage Supply Chain Technology

One of the most effective ways to improve your supply chain is to leverage all available supply chain technology. With all of the recent and rapid advancements in technology, there are a plethora of tools and systems available to help streamline your supply chain operations. Automation, machine learning, artificial intelligence, and IoT devices are just a few examples of technology that can be implemented to optimize supply chain processes, reduce manual errors, and increase overall efficiencies.

• Machine learning algorithms can help improve demand forecasting accuracy, reducing lead times and excess inventory. 
• Automation can help reduce manual errors, increase operational efficiencies, and enable a more streamlined supply chain process. 
• IoT devices can be used to monitor inventory levels, temperature, and other parameters in real time, ensuring that supply chain operations run smoothly.

Leveraging the resources available can be the solution to providing clearer insights to customers, stakeholders, and internal employees. When technology provides the data, the best solution is to take that data and turn it into actionable plans and goals. 

Focus on Supplier Relationships

Relationships are everything when it comes to the supply chain. Strong supplier relationships lead to better communication, increased trust, and ultimately better outcomes. Collaboration with suppliers can help identify opportunities for improvement, such as reducing costs, optimizing delivery times, or streamlining supply chain processes.

• Prioritizing communication and collaboration can ensure that suppliers understand the requirements, including quality standards, delivery schedules, and pricing. 
• Invest in supplier development programs such as training sessions, workshops, or one-on-one coaching. By investing in supplier development programs, suppliers meet the requirements of partnerships, improve their processes, and stay competitive in the market.
• Establish clear expectations and contracts. This helps to ensure that both parties understand their roles and responsibilities in the relationship. Also, it covers any consequences for non-compliance or other issues that may arise. 

Business has fundamentally changed. All vendors and suppliers have to work together to keep the supply chain moving. A good customer experience leads to increased spending and opportunities for growth. Eighty-eight percent of companies now prioritize customer experience in their contact centers. 

Implement Sustainability Initiatives

Sustainability strategies have risen to the top of the of almost every supply chain priority list. Shippers and consumers alike are increasingly looking for partners that prioritize sustainability. Therefore, implementing sustainable practices within the supply chain can be a differentiator for a business. Sustainability initiatives are perceived to be an expensive undertaking but in reality, something as simple as cutting down on empty miles is something that reduces costs. 

• Locally sourcing raw materials cuts down on transportation costs and helps to develop regional sourcing markets where the entire history of the raw material is known and can be told to consumers. 
• Sustainable packaging using recyclable or biodegradable packaging is an easy swap for sustainability measures. Especially in consumer-facing industries.  
• Renewable energy doesn’t have to be massive solar panel farms or wind farms; it could be something as simple as a few solar panels on the roof or electric vehicles for the warehouse to reduce emissions. 

Knowing where to start with sustainability is overwhelming, especially in regard to Scope 1, 2, and 3 emissions, but it doesn’t have to be. Starting with measuring current operations is half the battle through tools like Redwood Hyperion. Using data to develop a clear picture of current supply chain operations is the key to unlocking more opportunities. 

Increase Transparency

Increasing transparency in the supply chain can lead to greater trust and better decision-making. Supply chain transparency refers to the ability to track products and materials from origin to final delivery. Consumers today are more aware of the environmental and social impact of their purchases and want to know the origin of the products they buy. Not only are consumers looking for transparency in their purchases, but those in the B2B space also are craving transparency. 

• Collaboration and partnership involve working closely with suppliers and sharing information and data. Businesses can build more trusting and collaborative relationships, which can help to identify potential issues and work together to solve them.
• Regular reporting gives all partners in the supply chain data on sustainability, social responsibility, and compliance with standards and regulations, which in turn helps identify any potential issues or areas for improvement. 

Knowing that there isn’t a curtain to peek behind and all partners are being open and honest with each other builds an immense amount of trust that leads to a stronger future. Keeping a customer engaged and aware throughout the process is immeasurable in relationships and will reduce the chances of a customer being swayed by a competitor. 

Improve Inventory Management

Post-pandemic major shippers are struggling with loads of excess inventory. Efficient inventory management is critical to reducing costs and improving customer satisfaction. Excess inventory can increase storage costs and major problems for warehouse operations. On the flip side, insufficient inventory can result in stockouts and lost sales.

• Forecasting and demand planning involve predicting future demand for products and services and planning inventory levels accordingly. This ensures that businesses have the right amount of inventory to meet customer demand without overstocking.
• Conducting regular audits businesses can also identify any obsolete or slow-moving inventory, enabling them to take action to clear this inventory and improve cash flow.
• Analyzing inventory metrics can help businesses to identify areas for improvement and optimize inventory management processes. Key inventory metrics include inventory turnover rate, stock-to-sales ratio, and carrying costs.

Just-in-time (JIT) inventory systems were the number one way of managing inventory for quite some time. However, due to supply chain constraints during the pandemic shippers have been forced to make some changes. 

Reach Out to Redwood Logistics

If you are looking for a way to improve your supply chain, reach out to Redwood today. Redwood is a modern 4PL provider with a team capable of handling almost any supply chain hurdle. Having a well-rounded partner in the logistics industry can be a game changer for any supply chain. Especially those looking to foster better resiliency and enact strong sustainability efforts.