12 ways to increase supply chain velocity
Thanks to the Amazon effect, consumers expect the world-and they want it fast.
From upstream planning to final-mile delivery, companies use a variety of strategies to meet the demand for near-instant gratification. Here are 12 tips your company can do to get your supply chain running faster.
Move closer to customers
Some of the largest U.S. retailers are redesigning their distribution networks to speed the flow, changing their distribution center (DC) footprint and going to hundreds of smaller DCs around the U.S..
The goal is to shorten the last mile to enable same-day, next-day or two-day delivery.
Find a partner to extend your footprint
Not every company can operate enough DCs to get within fast shipping range of most customers. But a logistics partner can give that kind of reach.
Look for a partner with the capacity to hold inventory in facilities close to your customers, this way you can speed up your time between purchase and delivery.
Employ data on hand, for better planning
E-commerce software tracks every transaction between merchant and customer, this retail channel gives companies a wealth of data that they can use to improve supply chain speed—for example, by determining how to balance inventory among different DCs.
Invest in visibility
Visibility provides several benefits, including the ability to keep customers up to date on the status of their orders. It helps to boost supply chain velocity by giving a company the information it needs to effectively expand its distribution footprint.
In order to improve your product delivery time, you have to know where your entire inventory is and what it is. With that knowledge, when orders come in, the right product will be available to ship from the right DC.
Experiment with IoT
IoT technologies provide the raw data that fuels visibility tools, and can enable inventory tracking and segmentation, as well as geographical placement.
But as companies implement new data collection technologies, they should start with small proof-of-concept installations. A 90-day pilot requires only a small investment and provides valuable information about whether the company should roll out the technology further.
Use Predictive Analytics to sense potential disruptions
Collect data from external sources, such as news and weather reports, and social media, and then run that data through advanced analytics. The results may alert you in advance about upcoming events that could disrupt the supply chain.
Predictive analytics includes leveraging proactive risk mitigation plans and what-if scenarios and simulations to predict a disruption before it actually happens. Good contingency plans help to maintain the speedy flow of goods.
Deploy machine learning and automation to circumvent disruptions
As a company collects data on disruptions and their consequences, smart IT systems can learn from the experience and develop plans to mitigate future disruptions.
The ultimate goal is an autonomous, self-learning supply chain that not only strategizes to avoid disruptions, but puts those strategies into action.
Automate your warehouse
From sorters and conveyors to robots, companies have embraced automation to speed up a range of distribution or fulfillment center processes. Look for software and machinery that will help you to speed up your supply chain process.
Expand capacity with autonomous vehicles
The driver shortage is a well-known pain point for companies that need to move product. Demand for drivers outpaces supply not only in long-distance transportation, but also in the final mile.
For a company that can’t make all its deliveries fast enough because it doesn’t have enough drivers to handle the daily volume, autonomous vehicles can supplement the regular fleet.
Employ digital technology to manage last mile delivery for large items
When a customer orders a large item, such as a couch or a home theater system, the ensuing delivery is especially complex. Any small issue may force carrier and customer to reschedule, slowing the delivery and marring the customer’s experience.
In this case technology can improve crucial communications, through mobile apps or software the retailer could notify the customer when the delivery agent will arrive, and if there are any revisions to the delivery. Making sure large items arrive as scheduled and customers are pleased with the delivery.
Tap local couriers
A retailer doesn’t have to restrict same-day deliveries only to customers located very close to its distribution center or store. There are some local courier companies that cover a surprisingly wide area, just look around.
Join a network to find capacity fast
There are times when your preferred last-mile carrier won’t be able to make your last minute delivery. What to do?
Look for local business associations, directories or apps where you can increase your suppliers. Increasing your directory opens various opportunities for you to discover a wide network of last-mile carriers, including multiple local carriers in markets where a national retailer might not know the territory.