5 Easy Supply Chain Management Tips for Retailers
One of the most stressful things for retailers is having their profitability interrupted by disorganized supply chains. Whether it be due to late acquired items, lack of inventory, or poor logistics, inefficient supply chain management will hurt your business.
In order to prevent that nightmare from happening to your retail business, you need to master some effective strategies to optimize your supply chain management. Here are five easy ways to improve it.
1. Maintain Correct Inventory Levels
Inventory plays the most important role in supply chains, because it determines successful order fulfillment. Maintaining correct inventory levels will help you avoid downtime that leads to consumer dissatisfaction.
To keep a sufficient quantity of inventory, you must first determine minimum inventory levels. Make sure the inventory management software you use provides low inventory alerts that remind you whenever your items are near their minimum levels.
It is essential for you to check your inventory availability regularly. Make inventory checking easier with an inventory management system that provides you with real-time data.
2. Build Good Relationships with Your Suppliers
It is impossible for your supply chain to perform well without the help of your suppliers. This is why it is important for you to maintain good relationships with them.
Think of your suppliers as alliances, while working together to improve the buyer/supplier relationships. Therefore, make sure the communication between you and them is always smooth and has no obstacles.
Remember to pay all your bills on time so that your suppliers continue to trust you. Consider using a centralized system that makes it easy for you to track bills, receive quotations, send requests for quotations and purchase orders, and post receipts.
3. Increase Logistics Efficiency
As a retailer, you also have to evaluate and review transportation arrangements with your logistics partners to ensure the process of receiving and shipping goods always goes well. It is also important to look for opportunities to implement service level agreements (SLAs) with shipping partners to increase the level of trust.
4. Take Advantage of ERP Software
This may sound like an expensive investment for your business, but implementing ERP software will actually be the best decision you will ever make, as there are so many retailers that have implemented the automated solution.
ERP software helps retailers automate many time-consuming and error-prone processes, from demand forecasting, inventory checking, procurement, shipping, to product return. With this tool, you will be able to have comprehensive visibility of your supply chain.
5. Minimize Risks Through Periodic Reviews
You should meet your supply chain team and review your procedures and policies to ensure efficiency and effectiveness. This will not only help avoid process bottlenecks and facilitate operations, but also reduce the risk of theft and fraud.
The key to a solid risk mitigation is teamwork between you and your suppliers. This starts with choosing reliable and competent supplier. Furthermore, focus on streamlining the process of acquiring goods from suppliers and shipping goods to consumers.
Utilize technology as a way to avoid or correct delays. By regularly reviewing your process, you will be able to figure out any issues in advance and act proactively to fix them.