Analyzing where to invest in the supply chain can be a challenge. Shippers want to make sure that they’re getting the most out of their investments, but it’s not always easy to see what’s going to give the best ROI and what’s not.
From carriers to warehousing, inventory management systems, freight management systems, etc, there are just too many moving parts for many companies to aggressively pursue them all.
Depending on what is needed, there are many areas that supply chain leaders can invest in:
One of the best things to make room for in a logistics budget is risk management. By making risk management a priority, businesses can see a much larger return on their supply chain investments because it helps them determine what exactly is a risk and which of those risks are acceptable to take and which are going to result in a net loss.
Taking the time to learn how to mitigate the various risks involved in the supply chain (theft, damage and other liabilities) will help drop costs and add some predictability to the overall strategy.
Another place to invest is in supply chain technology. This technology will helps warehouse and shipping operations run more smoothly. New software such as RFID tracking and wearable technology make managing the supply chain easier, and although they require an investment, they pay off in their capability to streamline operations and reduce liabilities and errors.
It takes some time to choose the right products, and the process involves looking at the software’s efficiency, its asset utilization, and its customer response. Software that provides benefits in all three of these areas will give the best return on investment.
Make use of big data
Big data has been a topic of much speculation, but now it is an integral part of the supply chain. Investing in big data can do more than just provide ideas, strategies and other actionable intelligence, it can also help improve virtually every shipment made.
Big data plays into risk management, as well. It lets shippers analyze past and present operations, and can even offer predictions about the future of the market. This data can tell teams how industries and consumers might react to certain changes or variable shifts in the market.
When the supply chain becomes too much of a risk to mitigate, or a business is growing at an unsustainable rate, leaders should look to third party logistics providers for help. 3PLs are not an expense, but an investment that can garner the greatest ROI.
At King Solutions, we have helped our partners by providing them with the strategy, resources and intelligence that they need to succeed. Contact our team today to start investing in your company’s supply chain.