Tag: supply chain management

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Purchasing and Supply Chain Management Challenges and Ways to Overcome Them

In the current competitive scenario, purchasing and supply chain management is a reverse of prior practices where manufacturers supplied product to customers. Now customers tell suppliers how and when they want their inventory delivered. The objective behind purchasing and supply chain management is to remove inefficiencies, excess costs and excess inventories from the supply pipeline which extends from the customer back through suppliers.

By effective purchasing and supply chain management, it is hoped that inventories, caused by uncertainties and slow response, will be significantly eliminated. However, it is increasing challenges for businesses. The intersection of many disciplines, such as marketing, procurement, management, operations research, and logistics is making it difficult for businesses to analyze the impact of purchasing and supply chain management.

At SpendEdge, we understand the impact that purchasing and supply chain management can have on your business. Therefore, in this blog, we have compiled a list of purchasing and supply chain management challenges and the possible ways to overcome them.

Purchasing and supply chain management can provide tremendous competitive and business advantages. Request a free demo and know how our experts can help you leverage the same.

Purchasing and supply chain management challenges

Compliance

As navigating global markets is becoming challenging day by day, understanding and following the compliance requirements of various regional, national, and international markets is getting invariably complex. No matter what your company offers in terms of products and services, there are always sets of rules and regulations that your purchasing and supply management must comply with.

This includes various safety laws, environmental protection laws, standards and quality specifications that your product should be compliant with.

Your team, from managers and engineers to people managing your inventory and logistics, need to be aware of the relevant rules and regulations across the complete purchasing and supply chain management process.

Solution: Thorough understanding of supply partners and the risks associated with them in a timely and cost-effective manner are the basic steps towards effective purchasing and supply chain management. SpendEdge can help you in identifying the need and planning the purchase by critically evaluating the procurement process while complying with regulatory requirements.

Rapidly evolving markets

Consumer behavior is usually affected by cultural social, personal, and psychological factors that rapidly evolve due to changing market demands. This fast-changing market brings purchasing and supply chain management challenges and increases pressure on your procurement teams to keep up with the latest trends. You need to innovate new products while keeping the total manufacturing costs low as the trends don’t last long. Additionally, you constantly need to update the features of your products to sustain the competition. This increases the complexity of purchasing and supply chain management.

Solution: The accurate real-time insights pertaining to supply markets will help you make effective planning decisions and tackle challenges arising in the purchasing and supply chain management created by fast-changing markets.

 

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Globalization

Unlike earlier, supply chains are no longer confined to specific regions. The production of products can involve dozens of countries and hundreds of parts vendors and facilities. Even something as humble as pen or pencil might involve quite challenging logistics. This requires an efficient purchasing and supply chain management and detailed analysis of market size and entry barriers.

Solution: Extensive understanding of these global trade lines, and the ways they impact your company’s products and roadmap will allow you to optimize supply chain purchasing process and utilize emerging opportunities while expanding to a new market.

Supplier management

While managing your supply chain is crucial, selecting the right supply chain partners and the right suppliers is important for purchasing and supply management. They ensure that you are able to gauge market opportunities and achieve your organizational goals. Moreover,  with the right set of suppliers, you can follow the necessary standards, and pass the quality controls that your business demands.

Solution: The detailed study on every attribute from the supplier’s financial stability to the level of short and long-term liabilities will consolidate suppliers and reduce the risks associated with currency and interest rates. SpendEdge can also help you to reduce purchasing and supplier management costs and increase the efficiency of your procurement process.

Is your organization facing purchasing and supply chain management challenges that are hampering the growth of your business? Get in touch with our experts and know how they can assist you with tailor-made solutions. 

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Supply Chain Best Practices to Drive Business Success

The importance of supply chain management in today’s competitive market landscape cannot be undermined. With the expectations of both shareholders and consumers soaring, the collective capability, technology, resources, and scale of most supply chains have become insufficient.

Moreover, it can be said that the exponential increase in business complexities is one of the biggest challenges facing the supply chain. This surge in the complexity has been further fueled by challenges such as supply chain globalization, acquisition pace, new retail channels (i.e. omnichannel), regulations, and a rapid increase in the pace and complexity of new product introductions. This has forced companies to adopt supply chain best practices and renew their supply chain approach.

At SpendEdge, we understand that adopting supply chain best practices requires both knowledge and capabilities. Therefore, our team of experts has highlighted the supply chain best practices that companies can adopt to increase value creation across the supply chain.

Want to know how supply chain best practices can help you manage complexities? Get in touch with our experts and implement supply chain best practices for your organization. 

Supply chain best practices for companies

#1 Align supply chain responsibilities

Often, the decision-making power is divided among different people in organizations. This not only slows down the operations but also makes it difficult for companies to make quick decisions. Aligning supply chain responsibilities will ensure better supply chain management and greater efficiency for organizations.

#2 Utilize technologies

Companies integrate too many software to increase their efficiency without analyzing the needs of their organization. Instead, companies should analyze the efficacy of their processes that need improvement and then implement technologies that can address those needs. This is one of the supply chain best practices that can help companies to make better utilization of their supply chain.

#3 Devise strategic sourcing strategy

Strategic sourcing is imperative for supply management. It ensures the availability of supplies, lowers total cost, streamlines processes, and increases responsiveness to customers’ changing needs. Companies looking to implement supply chain best practices should focus on strategic sourcing rather than considering it the sole responsibility of the purchasing department.

Interested in devising a strategic sourcing strategy?

Request a free proposal and know how our experts can help you to devise state of the art sourcing strategies.

#4 Consider value over price

It is never advisable for companies to cut costs at every point of time, especially if they are aiming to achieve long term business goals. At times, they need to put value over price to retain their customers, keep business flowing, and establish themselves as a reliable supply chain partner. This requires companies to implement supply chain best practices and achieve better profits in the long run.

#5 Better inventory management

Inventory management is one of the supply chain best practices that companies are intending to improve upon in the years to come. It helps companies to substantially improve the bottom line and minimize their working capital. Even the top-notch companies are paying attention to inventory at the highest levels as it could represent over 50% of the cost of an item.

#6 Taking social initiatives

Reducing a supply chain’s carbon footprint is no more a choice for companies. It is one of those supply chain best practices that necessarily needs to be practiced. The reason being, buyers and consumers take it into consideration while choosing products or services. Any company not having productive social responsibility programs risks criticism from one or the other sources.

Implementing supply chain best practices is pivotal to increase the efficiency of the global supply chain. To know how your organization can benefit from these practices, request a free demo from our experts now!

 

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Top Five Benefits of Supply Chain Planning | SpendEdge

Continuously changing market conditions and consumer demands have made it vital for businesses to evolve rapidly and be prepared for unforeseen obstacles and circumstances in their supply chains. Today, businesses are under the pressure to develop new products and keep up with the latest trends while minimizing their total manufacturing costs. Without some sort of a comprehensive plan, businesses may fail at order fulfillment, which, in turn, can result in revenue loss.

Reducing life cycle of products demands a flexible supply chain that can be employed for manufacturing other products according to future needs. This requires enterprises to anticipate the demand for upcoming products and improve supply chain performance, making it compulsory for companies to follow the best practices in supply chain planning for better supply chain management.

At SpendEdge, we understand the impact that an effective supply chain planning can have on your business. And to help companies sustain themselves in the marketplace, our team of experts has highlighted five crucial benefits that companies can leverage through supply chain planning. But before we read about the advantages of supply chain planning, let’s know more about it:

What is supply chain planning (SCP)?

Supply chain planning basically refers to the companies’ ability to make accurate forecasts pertaining to their future demands. It is a process which requires companies to balance supply and demand and manage their assets to optimize the delivery of goods and services from suppliers to customers. Supply chain planning (SCP) provides strategic and tactical planning support to help deal with supply, distribution, manufacturing, planning, production scheduling, and forecasting.

Want to develop an agile supply chain that can address the rapidly changing market demands? Get in touch with our experts and know how our supply chain planning solutions can help you.

Top five benefits of supply chain planning

Retain customers

When companies support their supply chain planning with integrated demand forecasting, they are in a position to address spikes in demand. This reduces the chances of stockouts and helps companies fulfill their customers’ demand when they need it the most.  Meeting customers’ demands helps companies to win their loyalty and ensure sustainable profits.

Stay on top of demand

By implementing effective supply chain planning strategies, businesses can forecast the demand for their products. They can accommodate shorter product life cycles, the impact of fluctuating economies and emerging markets, and enhance their supply chain planning systems while responding to changes in demands. 

Reduce overhead costs

New businesses usually lack the competency and market knowledge required to reduce the prices of their products without affecting the overall operation in a drastic manner. With effective supply chain planning, companies can reduce costs in the production process without compromising the quality and price of the final product.

Increased production costs can affect the overall costs of products drastically. Request a free a proposal and know how an effective supply chain strategy can reduce the overhead cost for your organization.

Minimize delays

Many supply chains are plagued by delays due to some or the other reason. They constantly struggle with late shipments from vendors, issues on production lines, and logistical errors that affect their supply chain management system. Effective supply chain planning help companies avoid all such issues down the line.

Optimal shipping options

As new ecommerce companies continue to flourish, buyers have plenty of options to purchase products. In such a scenario, companies need an effective shipping plan to meet the demands of the marketplace. They need to ship products in a quick and efficient manner to ensure the success of their business. With the help of an efficient supply chain, businesses can determine the best way to ship their products and reduce costs at the same time. (more…)

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Spend Analysis : Assessing the Current Spend and Improving Supply Chain Efficiency for a Medical Devices Company – SpendEdge

Spend Analysis Solution Transforms Finance Operations and Reduces Operating Costs

About the Client 

The client is a leading medical devices company, specializing in the development of medical devices, laboratory instruments, and diagnostic products. The company supplies devices to hospitals, laboratories, and clinics worldwide. The company has ingrained its place as a leader in the medical devices market.

The Business Challenge 

The future looks sharp for the medical devices industry. With global economic growth, innovations and an aging population that has a growing need for healthcare, revenue for medical devices is poised for growth. However, in this turbulent environment, companies that can shift their supply chain priorities and better manage spend will be able to deliver significant value. Moreover, the rising need for supply management and strategic cost management have urged players in the medical devices manufacturing space to leverage the use of robust spend analysis solutions. Spend analysis solutions help companies in the medical devices manufacturing space to identify the potential opportunities and deliver actionable insights into the spend data to generate improved ROI. The spend analysis solutions also address concerns about the maverick spends across the supply chain and help achieve superior supplier relationship efficiently.

The client, a renowned medical devices company was facing challenges in reducing the cost across the supply chain and managing their tail spend. While public spending has become endemic, the client realized the need to drive more competitive pricing. Moreover, the client’s objective was to adopt spend analysis strategies to identify and optimize their spend areas. Additionally, the client needed to streamline their supply chain management and subsequently maximize profits by leveraging SpendEdge’s spend analysis solutions.

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SpendEdge’s Inventory Management Helped a Pharmaceutical Supplier Maintain Accurate Inventory Levels and Minimize Cost of Inventory

With the growing concerns pertaining to healthcare treatments, the pharmaceutical suppliers have witnessed a promising growth over the past few years. Moreover, the pharma companies are expected to witness considerable growth, owing to an ageing population, changing lifestyles, and unhealthy eating habits. However, with these rising customer expectations, the commercial environment is getting harsher with customers looking for cost constraints in the pharmaceutical products offered. Moreover, inventory management is becoming a major concern for the companies in the pharmaceutical industry. While the pharma companies can’t risk drug shortages due to lack of inventory visibility, they also never want to incur the costs of overstock that would negatively impact productivity and the patient experience. Thus, to address these challenges and enhance production capabilities, organizations are looking to devise an inventory management solution.

With the help of a reliable inventory management system, organizations can effectively keep track of their stock manually. In addition, the inventory management system helps businesses restock certain items, the amount of purchase, and the prices to pay.

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Top 5 Supply Chain Management Challenges Facing Companies in the Food and Beverage Industry

The food and beverage industry faces a lengthy list of unique challenges in terms of logistics and supply chain management, right from volatile commodity pricing and inventory management to quality and safety requirements combined with frequent new product introductions, high demand uncertainty, complex manufacturing constraints, and perishability. The need for inventory optimization in the food and beverage industry is growing due to the increase in customer demand, expanding product portfolios, and lengthening supply chains.

Inefficient inventory management in the food and beverage industry results in spoilage of products, resulting in bad supply chain management. This results in poor decision making at all the levels of the supply chain.  This leads to a vicious cycle, ultimately reducing sales, profit margins, and customer loyalty.

At SpendEdge, we understand the impact of better warehouse management on supply chain management. And to help companies strive in the competitive food and beverage industry, our experts have highlighted some of the major challenges that they must be aware of and prepare themselves for accordingly.  

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AI in Supply Chain Management: Top 4 Reasons Procurement Companies Should invest in AI in 2019

Just as artificial intelligence (AI) has made its way into finance and healthcare, it is now creating a fourth industrial revolution in supply chain management. The use of AI in supply chain management has brought about operational improvements for companies across the globe. It has made it possible to discover patterns in supply chain data by relying on algorithms that quickly pinpoint the most important factors behind the success of supply networks. Key factors influencing supplier quality, inventory levels, demand forecasting, order-to-cash, procure-to-pay, transportation management, production planning, and more are becoming known for the first time with the aid of AI in supply chain management. This is making supply chains more efficient and result-oriented. In this article, we have discussed some of the significant benefits of AI in supply chain management for 2019.

Benefits of AI in Supply Chain Management

#1. Helps in analyzing large data sets with maximum accuracy

For supply chain management, one of the most challenging aspects is predicting future demands for production. Before any solution of demand management is implemented, the master data needs to be cleaned up. This process of normalizing and cleaning the data costs more, takes far longer, and requires an ongoing effort. The use of AI in supply chain management can help simplify this process and improve the accuracy of demand forecasting.

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#2. Improves supplier delivery performance

AI in supply chain management helps in improving supplier delivery performance, reducing freight costs, and minimizing supplier risks. These are some of the significant benefits artificial intelligence is providing in collaborative networks of the supply chain. Today, AI in supply chain management can be used to identify horizontal collaboration synergies between multiple networks of shippers.

#3. Provide better insights into improving supply chain management

Artificial intelligence helps uncover new information to improve supply chain performance.  By combining the strengths of supervised learning, unsupervised learning, and reinforcement learrequest proposalning, artificial intelligence is rapidly becoming an effective technology that continually seeks to find important factors affecting the performance of the supply chain.

#4. Helps in maintaining physical assets across the entire network of supply chain

AI in supply chain helps at visual pattern recognition, opening up several potential applications in the maintenance of physical assets and physical inspection across the entire network of the supply chain. The use of AI in supply chain is also proving to be very effective at automating inbound quality inspection throughout logistics hubs, isolating product shipments with wear and damage.


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How Market Intelligence Can Dramatically Boost Your Supply Chain

The supply chain in modern companies is increasingly complex and dynamic in nature. From suppliers and industries to raw materials and commodities, there have been steady changes taking place across the supply chain of new age companies. Furthermore, the increasing uncertainty in the economic markets are forcing organizations to closely monitor market conditions and respond appropriately through improved supply chain strategies.

Traditional ERP systems are undoubtedly highly useful management tools, but they are mostly blind to external data. Their “inside-out” approach can leave companies inadequately equipped when planning and executing competitive supply chain strategies. However, with the advent of new market intelligence tools can resolve this problem. With the help of supply market intelligence, ERP systems can now incorporate real-time insights on suppliers, customers, and competitors, thus creating a perspective to reduce risk and create a competitive advantage. Here are just five benefits companies can realize with a market intelligence intelligence-driven supply chain.

Improved supply chain strategies

 It is vital to take into consideration the impact of potential events before undertaking supply chain planning. For instance, factors such as a sudden increase in demand, or in the event of any supplier undergoing a catastrophic event, companies must be able to be prepared to handle such situations. Market intelligence provides early warning signals and unique insights into events that are likely to occur. Furthermore, it can also help in assessing alternative suppliers and approaches. This prepares companies to handle unforeseen contingencies better.

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Competitive advantage

Competitive advantage often comes to companies who are more agile, nimbler, and react faster when compared to their peers in the market.  In fact, a quick reaction to unforeseen disruptions is the route for modern companies to gain a competitive advantage. For instance, if a particular supplier is struggling to meet the company’s demand, they can quickly move to an alternative. Or, if a key component may be difficult to procure, companies can lock up the supply before the competitor does. Market intelligence via real-time alerts is key to achieve this as it gives faster insights for companies to be prepared for contingencies in the future.

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3 Key Digital Supply Chain Challenges That Need to be Tackled in 2019

Long before the era of digitization that we commonly associate with Industry 4.0, supply chains have served as the lifeblood of industrial organizations. However, in recent decades, supply chains have grown increasingly complex due to the advent of advanced digital technologies. These technologies have helped the supply chain to evolve into something more interconnected, less linear, and more responsive to change. This new networked chain of supply is known as a digital supply chain. It has reshaped the way stakeholders transact and communicate with each other. The emergence of the digital supply chain has made the supply network a strategically critical component of the organization and has helped in making it more flexible and responsive. However, there are several challenges in the area of digital supply chain analytics, visibility, and planning that are essential to realize its true potential when it comes to driving innovation.

Digital Supply Chain Challenges

Challenge #1: Managing the digital supply chain

A digital supply chain includes applications, network, and data connections. It connects customers to the tech solutions that underpin e-commerce, unlike production supply chain that moves physical resources and raw materials among manufacturers, suppliers, and retailers. Therefore, with business transactions moving to the cloud, managing the digital supply chain becomes crucial for increasing revenues, control costs, and protect the brand.

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Challenge #2: Optimizing the integrated planning process

For any digital supply chain network, optimizing the integrated planning process is very challenging as most companies don’t leverage all the information to achieve the best planning result possible. Additionally, it has been observed that statistical forecast data or determined planning is manually overwritten by planners. So, for a digital supply chain to derive the best outcome, the organizational setup, arequest proposaldvanced level of integrated process optimization, processes, governance, and incentives need to be aligned between and within partners in the supply chain.

Challenge #3: Building a balanced roadmap

Shifting to a new market strategy with a digital supply chain network to accelerate growth can wreak havoc on the company’s highly customized supply chain. Therefore, it becomes crucial for the management to make sure that the new supply chain balances their competing demands and allows easy integration of new business models. A balanced roadmap can help in generating quick wins and provide flexibility to accommodate evolving technologies and future capabilities.


Is your organization’s supply chain ready to go digital or are you facing any of these digital supply chain challenges? Contact us now!

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