Business owners have been dealing with all sorts of persisting challenges for much of the year, from ongoing price increases to a tight labor market – supply chain shortages are simply another hurdle they’ve learned to manage.
On the back of this, geopolitical tension between Russia and Ukraine has also left much of the supply chain demobilized, all the while mass-producing countries such as China closed off much of its borders and ports of entry due to the country’s Zero Covid policy.
A recent SMB Retail Supply Chain Survey conducted on more than 305 logistics and inventory professionals paints a vivid picture of the challenges many businesses had to endure throughout the last 12 months.
Key findings from the survey revealed that roughly 86% of small-medium businesses have already been impacted by the war in Ukraine. The conflict has also meant that smaller businesses are not always able to take advantage of alternatives, with 91% of retail respondents feeling larger companies have an upper hand with their ability to produce and attain inventory quicker and more freely.
Geopolitical conflict isn’t the only factor that has increased the severity of the supply chain problem. Rising fuel costs, inflation, and a shortage of warehouse workers, truck drivers, and delivery employees have all added more stress to an already tight-roped industry.
Despite inflation eating into their disposable income, consumer demand has not subsided, as much of the American consumer market has shown strong resilience when faced with ongoing macroeconomic challenges.
For small business owners, on the other hand, ongoing headwinds are only digging deeper into their top-line performance. Even with consumer demand increasing, supply chain worries will only keep revenues plateauing, a site desperate business owners are trying to avoid for as long as possible.
With the holiday season rapidly approaching, business owners are hopeful that supply chain issues won’t hurt their holiday performance, a time when most businesses try and make up for lost profits experienced throughout the year.
Navigating challenging supply chain conditions will not be easy, and there is a price to pay for it. Here’s a look at five ways business owners and entrepreneurs can navigate challenging supply chain conditions ahead of the holiday season.
Diversify Vendors
First off, business owners should already start looking into diversifying their suppliers and vendors, long before the holiday season kicks off. While the majority of organizations have been planning ahead of time, small business owners will need to take advantage of the vendors they have available.
Aside from having a few vendors to choose from, it’s also a good idea to look for suppliers within the direct area the business is operating in, and in the outlying areas. It does mean that businesses might need to pay a bit extra for transportation costs, but it does ensure that the company will be well-stocked for the holiday period.
Order in Bulk
For businesses that are in a financial position to buy in bulk, doing so well in advance will ensure your business is secured and prepared for any curveballs that may be waiting for you.
Buying in bulk comes with a lot of risks and rewards if executed correctly. For starters, if a business does decide to buy in bulk, but is unable to move most of the inventory it will be operating against a loss. On the other hand, not buying in bulk and running out of popular items can leave an even bigger impact on the balance sheet by the end of the season.
It’s all a balancing act, and business owners should ensure they stock up on the most popular items, and keep the lesser-bought products aside as an alternative option.
Adjust Product Availability
Businesses that offer a wide selection of products may need to start thinking of making some changes to their offerings as a way to mitigate potential supply chain bottlenecks.
The best way to go about this is to consider which products are the most popular, and which have been sitting around for months without seeing much traction. On top of this, hard-to-find and niche products should also be avoided during periods of high volume and consumer demand.
Having a straightforward offering, and giving clients exactly what they want during some of the busiest times of the year solidifies a good-standing business and consumer relationship.
Network with Vendors and Suppliers
Another easy way to ensure your shelves are stocked and customers are happy this holiday is to network with your current vendors and suppliers, this way it will be easier to find alternative suppliers in case any issue does occur.
Networking with other vendors and suppliers is also an easy way to spot where you can get a more cost-saving deal on specific items, and how much you will be able to save during harder financial times.
On top of this, if you network more frequently with vendors, you can establish a long-lasting relationship with your suppliers, making it slightly easier to navigate any occurring supply chain issues.
Use Efficient Tools to Track Inventory
A final step business owners can take to help them navigate the upcoming holiday season is to implement and use proper tools and resources to track and monitor inventory levels. More so, using these tools not only ensures that enough stock is always available, but can also mean businesses can know exactly when to do a follow-up order, and track their delivery.
Using the right tools can mean more than ensuring a shipment is delivered on time. It ensures that a business has a well-functioning system in place that constantly monitors inventory and stock levels even during times of peak traffic. It’s a bit of a pricey investment, but this should be viewed as a long-term commitment, rather than a near-term solution.
Final Thoughts
Businesses have already endured major challenges this year, and the upcoming holiday season could be a potential rebound for many desperate businesses looking for an alternative to ongoing issues that have now plagued the supply chain industry for well over two years.
The coming months will tell whether the global supply chain has managed to fully recover, or whether we’re still in the midst of a pandemic-induced problem that looks to continue well into the new year.
While business owners won’t be able to control many of the conditions, they will need to focus on those aspects they can control and manage. Being prepared, and equipped not only shows that businesses are ready for what’s to come but also indicates their willingness to adjust and plan for both near and long-term challenges.
Published First on ValueWalk. Read Here.
Featured Image Credit: Photo by Toni Cuenca; Pexels; Thank you!
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