Why Your Supply Chain Is The Key To The Future Of Your Business
By Blake Zalcberg, President of OFM
An inefficient supply chain can ruin your customers’ experience while a great supply chain is invisible to them. They order something you’re selling and it arrives promptly. They would no more think about how that happened than they would daydream about your company’s monthly electric bill.
But make no mistake about it; your business’ ability to scale up and sustain itself in the future will be affected in part by how you think about your supply chain and its ability to match your company’s culture and your customers’ expectations.
Thanks to innovations such as the internet, shipping containers, and just-in-time manufacturing, today’s supply chains are remarkably efficient. But that means the tolerance among consumers for an unexpected delay or even a slightly slower-than-usual delivery are lower than ever.
Think of it like a microwave burrito. You only have to wait a minute for them to cook — faster than any hot meal available to our ancestors — but watching that clock tick down for 60 seconds can be excruciating.
A great supply chain begins with choosing the right partners. You need to find people who understand your business and what you want to accomplish for every stage of the process, from suppliers to drivers to internal workers. Then you need to gather the right information and use it well.
As president of OFM, a furniture manufacturer and distributor that delivers nationwide, I’m responsible for a business operation that ships 9,000 different products from six warehouses across the country.
When we started in the mid-1990s, there weren’t many tools to determine how efficient we were. Today, there are lots of great software to track origin points to help managers determine where they should be placing your merchandise.
Companies like LamaSoft, a logistics management organization, and Tablu, a software company in California that focuses on business intelligence, can help you. We didn’t know we had a problem until we used some of this software to look at the efficiency of our supply chain and realized how much better we could be doing. We aren’t thinking about this the same way that we did even five years ago. Even as we’ve addressed some of the issues we’ve found before, we have been pushing ourselves to reduce shipping time even further. Our ultimate goal is to ship 100 percent of our products the same day we receive an order, with the consumer receiving shipment within two business days, regardless of the service level chosen at the time of order.
One critical lesson we’ve learned: Start the process of looking at the efficiency of your supply chain early. If you have leaks and cracks in your supply chain when you are smaller and are looking to get bigger, it will be easier to fill them in now and help stay efficient as you grow. It’s like setting a good workout routine when you’re a young adult that you can continue well into your adulthood.Managing your supply chain efficiently starts as a routine, then becomes a habit.
Another important thing to remember: Your supply chain isn’t just about moving widgets. It’s also about managing your customers’ expectations.
As you are planning your strategy, ask yourself what kind of experience you want the buyer to have. How do you want your customer service representatives to respond when someone calls who is irate that a package hasn’t arrived yet? If you’ve done your homework on your supply chain, those calls should be rare, although they will happen sometimes. How can you best help the customer and ensure the same problem doesn’t occur again?
It may not be on the chart, but your supply chain really begins with you ensuring its operating efficiently and quietly behind the scenes so you exceed the expectations of your customers both in your customer service and the products you offer.
Be sure to utilize the many available tools to find out whether your supply chain is operating smoothly and whether you are partnering with the right people to make it work. After all, the success of your business depends on your supply chain, and the future of your company rests on it working efficiently.
About The Author
Blake Zalcberg is president of OFM, a furniture manufacturer and distributor headquartered in North Carolina with distribution centers there and in California, Kansas, Pennsylvania, and Washington state. For more than twenty years, it has provided affordable and quality furniture through a nationwide dealer network, offering the latest concepts and designs for a variety of markets including home and hospitality, businesses and government, and health care and education. Working with manufacturers in Taiwan and China, OFM designs furniture to meet the highest industry standards which are sold through a variety of retailers, mail-order catalogs, and online dealers including Staples, Wayfair, Overstock, and National Business Furniture. To learn more about OFM, visit: http://www.ofminc.com.