One of the most important and often overlooked aspects of starting a new business is the supply chain. The supply chain is the system that gets your product from the raw materials stage to the customer. A well-run supply chain is at the heart of a successful business, but there are a number of common issues that can arise. Jeffrey Hammel will take you through some of them below.
6 Supply Chain Challenges Faced by Businesses
One of the most common issues is product availability. According to Jeffrey Hammel, this can be a huge problem if you are relying on a single supplier for a key component of your product. If that supplier has an issue with their own supply chain, it can cause delays and shortages in your own product. It’s important to have multiple suppliers for key components, so that if one has an issue, you can rely on the others to keep your production running.
Increasing Costs of Goods
Another common issue is the increasing cost of goods. This can be caused by a number of factors, such as raw materials becoming more expensive or transportation costs going up. It’s important to keep an eye on costs and to have a plan in place for how to deal with rising costs. This may mean finding new suppliers or renegotiating contracts with existing ones.
Warehousing and Inventory Issues
Warehousing and inventory issues can also be a problem for new businesses. If you don’t have enough space to store your products, it can cause delays in shipping and lead to stockouts. It’s important to have a good system in place for managing your warehouse and inventory. This may include hiring additional staff or using technology to help keep track of your stock levels.
Keeping Up with Customers’ Expectations
Jeffrey Hammel believes that meeting customers’ expectations can also be a challenge for new businesses. Because customers are used to getting their orders quickly and efficiently from established businesses, they may not be patient with a new business that is still working out the kinks in its supply chain. It’s important to set realistic expectations with customers and to keep them updated on any delays or issues.
Transparency and Integrity
It’s important to be transparent and honest with your customers about any issues in your supply chain. If there are delays or problems, let them know as soon as possible. Customers appreciate honesty and will be more likely to work with you if they know you’re upfront about any issues.
Lack of Expertise in Supply Chain Management
Another issue that can arise is a lack of expertise in supply chain management. This can be a problem if you are starting a business that requires a complex supply chain. In this case, it’s important to either hire someone with experience in supply chain management or to partner with another company that has this expertise.
These are just some of the common issues that can arise in a new business’s supply chain according to Jeffrey Hammel. It’s important to be aware of these issues and to have contingency plans in place for how to deal with them. By doing so, you can ensure that your new business has a smooth-running and successful supply chain.