Organizations worldwide are struggling with supply shortages, inventory overflow, frequent delays, understaffing, higher transportation costs, rising inflation and fluctuating consumer demand. Amid these challenges, here are five ways to improve the resilience of your network.
1. Streamline. Effective inventory management leads to lower costs and improved flow and stock levels. This, in turn, offsets many of the problems caused by today’s onslaught of supply chain disruptions. Begin by investigating inventory management software to track current inventory and stock levels, manage suppliers, and forecast supply needs. Also consider implementing warehouse management software to help control inventory storage and item picking.
Two other popular options are automated storage and retrieval systems (AS/RS) and goods-to-person (G2P) tools, which enable you to hold more inventory and free up valuable floor space by going vertical. They also help eliminate the need for additional real estate and lower costs for material handling and overhead resulting from inventory overflow. Plus, these solutions make it easier to keep backup or buffer stock without impeding other warehouse operations. And they help secure inventory and minimize shrinkage, while enabling fast order fulfillment or store replenishment.
2. Automate. Even a small degree of automation — conveyors, automatic guided vehicles, autonomous mobile robots, sortation systems and others — can make a big difference. Automating activities such as inventory handling, order fulfillment and returns processing reduces labor costs and enhances productivity. With reduced reliance on manual labor, supply chain organizations are less susceptible to disruptions from labor shortages or turnover and can even reduce the number of temps needed during peak seasons. Of course, this isn’t to say that employees will be replaced entirely; humans are still needed for higher-level tasks. However, automated helpers can make their work safer and more efficient.
3. Optimize. With growing inflation and rising global tensions, both e-commerce and retail sales are likely to decline. Still, consumers are always going to consume, so supply chain professionals can’t lose focus on order fulfillment. Again, streamlining order fulfillment with some degree of automation can ease constraints and delays. Likewise, improving the returns process helps keep inventory moving and makes items available again for sale, when possible, to recover income.
Incorporating order fulfillment software, commonly used with an automation system, significantly improves order accuracy and speed by guiding employees through picking and packing activities. When paired with an AS/RS or G2P solution, order fulfillment software creates a simple and unified operator experience and order-fulfillment or returns-processing workflow that helps to reduce costs and maximize output without adding more labor.
4. Diversify. Lack of supply chain diversification can cause delays, backorders, unhappy customers and revenue decline that ultimately hurts profits. Adding more warehousing partners in separate locations is one of the strongest ways to improve resilience, as having backup sources is critical. Unfortunately, diversifying an established supply chain can be difficult, and it requires extensive planning. Look to supply chain software including sourcing and procurement tools, supplier management solutions, and others to unify multiple sources into one holistic network.
5. Prioritize sustainability. An essential way to achieve supply chain resilience is to keep a keen focus on sustainable practices. Sustainability lowers costs and offsets rising expenses from increased shipping and transportation rates by conserving resources and reducing energy use. Organizations can achieve significant benefits by improving the efficiency of their buildings, vehicles and machinery. Implementing new software or automation systems to streamline operations also can reduce labor and overhead needs while meeting sustainability goals and lowering energy costs.
Drew Stevens is vice president of global business development of warehouse automation at Opex. He and his team work directly with clients, conducting operational analyses and designing customized automation solutions. Learn more from the Opex white paper “Scalable Storage and Retrieval to Match Warehouse Progressive Demands” at warehouseautomation.com/white-papers.
Learn more about this topic with the ASCM Supply Chain Warehousing Certificate. This foundational program, developed by ASCM in partnership with Prologis, provides an overview of key warehousing and distribution topics to help learners improve their skills in this important function.