Cleveland 3PL Helps Identify Your Top Supply Chain Weakness
As long-time Cleveland 3PL providers, the On Time Delivery & Warehouse team is trained to quickly spot any hint of a supply chain weakness so we can either address it fast or – better yet – avoid it altogether. That keeps our partners from losing profits, customers and investor faith.
A single supply chain weakness has the potential to stymie productivity, spike company costs and hamper a business’s ability to deliver quality.
In recent years, there have been numerous instances wherein a supply chain weakness forced a business to close its doors – temporarily or permanently – or curtailed its ability to offer key products. Worse, those failures made big headlines.
Supply Chain Weaknesses That Caused Big Company Losses
Cleveland third-party logistics company professionals know supply chain weaknesses can crop up anytime, but businesses can be especially vulnerable anytime there is market growth, increased competition, a natural disaster or a merger/acquisition.
- Wal-Mart. In 2011, a tsunami in Thailand affected a key link in Wal-Mart’s supply chain, causing stores in Japan to run out of mouthwash, Reuters reported. It also caused personal computer shipments to drop by as much as 20 percent in the first quarter of the following year.
- Finish Line. The athletic wear retailer in January 2016 announced closure of 150 stores, just after reported quarterly earnings dropped nearly 6 percent. There were several reasons for the retail store closures (struggling malls, failure to distinguish itself from competitors, etc.). But the profit loss – some $32 million – was the result of “major supply chain problems,” per the Washington Post. Specifically, the company launched a new system for managing inventory, and it didn’t go well. There was trouble getting fresh inventory to stores and online because the new system wasn’t equipped to process adequate freight volumes necessary to support the company’s sales plans.
- Kentucky Fried Chicken. Last February, a supply chain weakness issue caused the friend chicken company to close some 900 stores in the United Kingdom following delivery issues that resulted in those locations running out of chicken. Workers were encouraged to take a holiday, but weren’t required. The BBC reported the supply chain weakness occurred when the fast-food restaurant on-boarded a new delivery firm. At least the company’s public relations specialists spun it well with a sense of humor, remarking on Twitter that,” The chicken crossed the road, just not to our restaurants.”
Another driving force in some of these cases is the fact that supply chains are increasingly going global. Whereas wares used to be primarily made and shipped locally – or at least within the same country – today even small businesses rely on warehousing and delivery partners stationed all over the world. And as our Cleveland third-party logistics professionals know well: Your supply chain is only as strong as its most vulnerable link.
How a Cleveland 3PL Can Minimize Supply Chain Weakness
As supply chain networks are increasingly becoming more complex – and frankly, volatile – the more critical it is to have a strong foundation. You can’t control the the actions of a vendor who is six degrees removed from you. Nonetheless, your company will be accountable for any issues that vendor has. This is where working with a dedicated third-party logistics firm pays off.
Our team has numerous strategies to help identify supply chain weakness for our clients. This includes real-time supply chain observation. Monitoring the supply chain flow in real-time gives our Cleveland 3PL the benefit of instant feedback. We can watch for hold-ups and reroutes and watch for the need to increase or decrease the number of human handlers or partners.
We also recognize our third-party logistics firm can’t overlook planning for low-probability, high-impact events – things like factory fires, Hurricane Katrina or political unrest in a region halfway across the world. They don’t happen often and aren’t easily predictable (if at all) – yet can have catastrophic impact to businesses that aren’t prepared. This can be done by identifying key suppliers and determining their time to recovery (how long it would take to get things back up-and-running at full functional capacity). This data can be used to identify, manage and reduce exposure to this type of supply chain weakness, as noted by the Harvard Business Review.
Supply chain weakness is something almost every company faces. Working with an experienced Cleveland third-party logistics partner like On Time Delivery & Warehouse, you can be assured losses are minimized or avoided.
If you have questions about a supply chain weakness or have interest in working with a dedicated Cleveland 3PL partner, contact On Time Delivery & Warehouse by calling (440) 826-4630 or sending us an email.
Find the Weak Link in Your Supply Chain, June 9, 2015, By David Simchi-Levi, Harvard Business Review
More Blog Entries:
Why Ohio Supply Chains Must Be Hurricane-Ready, Aug. 15, 2018, Cleveland Third-Party Logistics Blog
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