Sunday, June 16, 2019

Steps For Supply Chain Planning

By Betty Richardson


Different size companies have employees in various positions in order to make sure everything gets done to keep the business running. Throughout these positions are many that relate to supply chain planning. This is an important function and any business that sells a product needs to have the people in place to make it happen effectively. Without them in place, there can be disastrous consequences that cause product delivery delays, increase needs for customer service, and can cost the company money.

One of the first positions to fill is purchasing. This person will be responsible for making sure everything from raw materials to pens and paper are on hand and available for use. They will work out deals for good products, lower shipping rates, keep the supply available.

Manufacturing needs to have the raw materials in place at all times. If the raw materials run out, the factory grinds to a halt and employees may be laid off periodically while they wait for more material to work with. If this happens the cost to the business is found in lost wages and lost sales. The same situation occurs for assembling products if one or more of the needed parts are not available.

Managing inventory ensures you know how much you have. It seems trivial, but it is also critical. If you sell too many products and cannot ship them, you have to refund the money. This is lost money and will develop a bad reputation. Those customers may not come back and may prevent others from becoming customers. Inventory needs to be counted both manually and digitally at least monthly to keep up with the changing numbers. The manual count ensures the tracking system is keeping an accurate count.

The warehouse manager works with the inventory. Not only will they know how much of anything they have, but will be able to easily locate it. Much like a store knows which shelves products are on, the warehouse staff will know the same information about raw materials and parts for assembly. This will get the needed materials to the factory quickly and efficiently, saving time and money.

Transportation is a key function. If you can ship the product through a regular company, you need to be able to track each shipment. For those companies that have their own transportation, they will need to know when and where each truck is and needs to be. Even if your employees are not the ones driving, you still need a shipping and transportation manager to make sure the products get to their destination.

Customer service provides the customers with information and uses the systems in place to do this. The tracking and ordering systems need to be accessible to the customer representatives so they can quickly provide status updates to customers and work to resolve problems.

Having someone do demand planning will make sure you are not overspending or running out of inventory. This person is required to analyze sales trends and other aspects of the business. Spending too much on a product that is moving slowly removes funds for other products and business needs. There is a fine balance that needs to be maintained so there is enough product to sell without having too much on hand, which costs money.

There are many steps in getting a product to the customer. Each step requires someone, even if it is the same person, to manage different functions that are all critical to the balance the business needs to maintain. If one piece is missing, the product can run out and sales can be lost.




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