So you’ve built your business to a point where you’re ready for a supply chain. For most retail and B2C business, sustainable growth and profitability relies heavily on the efficiency of your supply chain. No matter your industry or niche, it’s essential that your supply chain is proactive enough and can account for your forecasting to keep your product on the shelves all while leaving room for change and innovation.
When building your business’ supply chain, one of the first decisions you have to consider is whether to source local manufacturing or employ a global scale of production. Traditionally, global supply chains have almost always correlated with high rates of success and profitability as well as the ability to scale quickly. The majority of major branded products undergo some level of global manufacture.
Understandably, you want to keep overhead with workable margins. Looking for the least expensive product or service often leads you overseas as a result. A global supply chain also helps keep a business constantly innovative and nimble in response to the ever changing technology. In addition, some products simply can’t be produced locally due to a lack of manufacturing infrastructure for the materials and labor you are working with.
Global supply chains are a network created among various companies producing, handling, and distributing goods from around the world. Global supply chains have long been an important factor of thriving businesses – earlier this year, Amazon revealed plans to launch a global shipping and logistics operation to compete with United Parcel Service Inc. and FedEx Corp.
So what are the benefits of using a global supply chain for your business?
- Reduced costs – When you have more of a choice in the components of your supply chain and who manages it, it means you have more of a choice of what you want to pay. Global suppliers tend to be more competitive with their pricing than local suppliers.
- Higher standards – In addition to lower costs, the competitiveness of global suppliers means there is more pressure to produce a quality product quickly, knowing their customers can easily choose from many different suppliers if they don’t do it right the first time.
- More choice – About 90 percent of global demand is not fully met by local supply. Working with a global catalog of suppliers gives you more choice for your supply chain.
- Greater Labor Pool – When you open your supply chain up to a global level, you have access to a greater labor pool that can potentially lend much more expertise to your supply chain.
Because of the importance of a well-oiled supply chain, many businesses are turning to supply chain management companies that have the time, expertise, and commitment to devote their days making sure your supply chain is running efficiently and effectively. And outsourcing works – 90% of businesses cited outsourcing as a crucial component to their growth strategies.
Our supply chain management consultants at Inertia have teamed with many varying clients across all industries and can realize supply chain priorities through building connections between strategy and design and employing their expertise to implement results that will yield success. Call us today to learn more about Inertia and how we can partner with your business to serve your supply chain needs.