Don’t Let Your Supply Chain Be an Afterthought
By Jeremy Murchland
The annual Consumer Electronics Show (CES) in Las Vegas came to a close just about two weeks ago. Unless you ONLY go to CES to walk the showroom floor, it’s impossible to see everything; however, thanks to the internet and social media you can easily find a fair share of recaps, “top product” articles, opinion pieces, and posts with the hashtag #CES2018. As a supply chain professional, for each new product that sparked my imagination, my mind immediately tries to visualize the supply chain required for these products to make it to market and be successful.
This year’s show was dominated by buzzwords like artificial intelligence, augmented reality, robotics, self-driving vehicles, and the Internet of Things (IoT). At Eureka Park alone, there were over 800 start-ups from all around the world. Many of these start-ups have some very innovative products and services, but yet so many fail to achieve success. In fact a study from CB Insights suggest 90% of start-ups fail in the first few years. Why? A simple Google search will turn up many articles and blog posts on the subject, but this one from Entrepreneur Magazine summarizes seven of them:
- Poor cash flow management
- Too much pride
- No market need
- Making the wrong hires
- Unwillingness to pivot
- Operational inefficiencies
- Poor corporate culture
Interwoven into several of the above, I would further suggest that poor supply chain performance is a key contributing factor to the failure of many companies. In fact, did you know that 79% of companies with a high performing supply chain achieve revenue growth greater than the average? (Source: Logistics Bureau)
The reality is that poor supply chain performance will contribute to cash flow management issues and operational inefficiencies which both can lead to customer losses and poor corporate culture. And, unfortunately, many start-ups, early stage growth companies, and even some more mature ones moving into new products and channels don’t know where start. That is because they are initially hyper-focused on product development and innovation. They are lacking in experience and knowledge to set an appropriate end-to-end supply chain strategy, design an optimal and scalable network that is going to support future growth, implement the tools and processes that help effectively manage working capital, and drive a high level of supplier performance.
So, what is the solution? Go out and spend millions of dollars working with high dollar consulting firms, implement expensive tools, hire a chief supply chain officer from a Fortune 50 company, and proceed to have other, different cash flow issues? Yes, that’s one option. Or, there’s another. Work with a proven supply chain solutions company with whom you can collaborate to help design and manage your end-to-end supply chain needs from sourcing and procurement to channel distribution and fulfillment to reverse logistics and repair. At ALOM, our tenured and highly competent supply chain professionals have designed and implemented highly-scalable, custom services for companies that are traveling quickly up the growth curve as well as those with mature supply chains but are launching new products into new channels in which they have no experience. By partnering with ALOM, you can focus on product development and innovation, sales, and marketing while we build the operational infrastructure that can scale as you grow and meet the requirements of today’s customers to have a highly efficient and agile supply chain.
Supply chain management cannot be an afterthought, and whether you are making your way up the growth curve with the latest technology or launching a new category of products into completely new markets, make sure that your supply chain is an integral part of your business strategy and is prepared to support future business growth.
For more information on ALOM and our Supply Chain Services, please click here