Port of Los Angeles
How Mid-Size Businesses Can Win During Supply Chain Disruption

How Mid-Size Businesses Can Win During Supply Chain Disruption

March 7, 2022
One solution would be for companies to invest in process automation which enables organizations to do more with less in less time.

Supply chain issues continue to make headlines as new challenges present themselves daily (e.g. China’s new COVID lockdowns). This disruption has affected small to medium size businesses particularly hard as they often don’t have the resources to stockpile inventory well in advance.

Manufacturing SMBs might be some of the most vulnerable – a Census Bureau's Small Business Pulse Survey found 39% of manufacturing small business respondents said they would need to identify new supply chain options within the next 6 months. 

Here are some questions that mid-size manufacturers need to ask themselves to ease supply chain friction.

What do I do when foreign problems challenge manufacturing timelines and more importantly how do businesses counteract them?

A disruption overseas can shut down a plant for 2-3 weeks that has the potential to disable a manufacturing facility and furlough workers in the U.S. if that facility only has 3-5 days of inventory. Relying too much on any one country, whether for your customers or for your goods and products, can be a risky proposition.

A case in point: China. While the country’s large ports, flexible workforce, network of suppliers, and efficient transport infrastructure mean that it will remain a key part of the global supply chain, shifting production hubs out of China, and into similarly competitive countries in Southeast Asia.

The recommended “China plus one” strategy helps companies to create fallback positions in case of pandemic-related delays or geopolitical tensions. While traditionally companies have relied on large production hubs like China to create economies of scale, technological innovations are making it easier for companies to build resilience into their supply chains by creating networks of smaller facilities spread across different regions.  

Should manufacturing automation be dominating my business agenda?

Manufacturing automation tools deliver the ability to streamline workflows by removing human process errors and delays to keep operations lean, efficient and productive — and also allow manufacturers to measure asset and production performance. Many companies today are dealing with the new norm — less skilled human resources available relative to years past to keep up with rising demand. 

Process automation tools and technologies are designed to perform tasks faster than a person, and they don’t require sleep, breaks, or lunch — making 24/7 operations more efficient. At the end of the day, process automation enables organizations to do more with less in less time. In fact, McKinsey predicts automation could raise productivity growth globally by 0.8-1.4% annually. 

How do I use data analytics to better understand and manage risks within the global supply chain?

As cited by HBR, bad data costs U.S. companies $3 trillion each year. While getting an order wrong or entering incorrect quality data are problems that can be resolved, it takes up valuable time. If those problems start to impact customer satisfaction, it can negatively impact the entire business, contribute to churn and create more work for staff in the long term.

Manual data collection can cost businesses dearly. The automation of redundant tasks like data entry allows organizations to have a deeper trust in their data. Data analytics tools such as scenario analysis, probabilistic and stochastic modeling, and industry-wide event cataloging can help companies to better understand and manage their supply chains.

Dedicated ERP-compossible solutions are another easy and cost-efficient first step solution. 

Is investing in customer service a more impactful tool in building the long-term value of my company than altering pricing, given continued supply chain challenges?

Businesses across the board are facing increases in costs of inputs, from labor to raw materials and supplies. Before considering price hikes ask yourself, do you have a firm grasp of your competitive landscape? What are your competitors doing? Are they raising prices? Are they struggling to even fulfill critical customers? Do they have stockpiles of inventory or sizeable capital reserves to leverage?

Of course, much of this will not be public information, but the word on the street is very powerful. Reach out to industry connections to attempt to paint the broader picture. Using the understanding of the market landscape, businesses can assess if there is an opportunity to gain market share or reinforce customer loyalty?  This will help you decide if the power of customer service could be a much more impactful tool in building the long-term value of your company than altering pricing. In particular, review your eCommerce strategy to make sure you are making your customers' experience as seamless as possible.

Gartner predicted that B2B direct sales transactions would surpass B2B direct sales by the end of 2021, and while we haven’t seen the final numbers yet, no one is questioning it is not a matter of if only when. However, the key barriers to eCommerce success for a complex engineer to order products can include the inability to negotiate complex agreements, buy the full range of goods and services offered by the seller, or obtain the best price. To combat these consider investing in a visual product configuration tool that can handle complex business rules with a no-code engine that’s easy for sales staff to learn and maintain. 

How does my business begin re-thinking the value of “just-in-time” shipping?

Global supply chains were set up to ensure that goods and products arrived “just-in-time” to meet customers’ increasingly stringent delivery expectations, and as customers’ need for instant gratification led to cheaper prices and ever shorter delivery timelines, companies and countries raced to the bottom in their efforts to keep up. The pandemic revealed the weaknesses in that “business as usual” way of thinking, and as we look to unwind the kinks in the global supply chain, companies must shift their mindset from “just-in-time” to “just-in-case,” and use technology to help rebuild their product buffers while still remaining competitive.

About the Author

Andy Coussins | International Sales Leader, Epicor

Andy Coussins brings senior international sales, operations and enterprise software industry executive experience to Epicor. In the role of senior vice president and head of international, Coussins is responsible for driving sales, focusing on accelerating company growth throughout Europe, Middle East, and Africa (EMEA), and Asia Pacific (APAC).

Coussins joined Epicor from Hewlett Packard Enterprise where he was vice president for the Alliance Business in EMEA. He has extensive international sales experience and a strong reputation for building high performing teams that are instrumental in driving global growth. Coussins is based in the Bracknell, UK office.

Before joining HP, Coussins spent 13 years with SUN Microsystems where he was chief of staff to the EVP of global sales and services based in Palo Alto. Prior to this role he was responsible for services in southern Europe, Middle East, Africa and Central Eastern Europe. His career with SUN also included managing education for EMEA, the industry business unit for retail travel and transport EMEA as well as various other sales leadership roles. Preceding this, Coussins held various senior sales roles at IBM.