5 THINGS MANUFACTURERS SHOULD ADDRESS NOW TO REDUCE RISK AND SECURE CASH FLOW.
As a Manufacturer you will have seen a wide range of business impacts as a result of the pandemic. From staggering growth to total shutdown, to disrupted unpredictable supply chains or an inability to source parts or raw materials.
Addressing these 5 things in your business right now will help to reduce risk and secure your cashflow to ensure business resilience.
SHINE A SPOTLIGHT ON YOUR SUPPLIERS
You’ve probably been forced to evaluate your vendors with the view to strategically sourcing raw materials or components. Many manufacturers are also looking into secondary and tertiary suppliers to avoid future supply chain hiccups.
Reviewing your BOM will allow you to identify critical points of supply, prioritise which areas to find backup supply, and then go to market to find alternative material sources for those at highest risk.
This contingency planning will reduce the risk of scrambling to find suppliers in the event of future supply chain disruptions which are likely to occur in the short to medium term as a result of the Coronavirus pandemic and intensifying global trade wars. Your plans might go so far as to include supplier communication capabilities and your ability to self-monitor their inventory levels or logistics.
SCRUTINISE YOUR INVENTORY MANAGEMENT STRATEGY
Reducing the levels of stock on hand and lean inventory management is usually one of the fastest ways to improve your operating margins, however as many manufacturers are stocking up and keeping more inventory on hand than they have historically in response to the current operating environment.
Manufacturers must conduct a balancing act of holding enough inventory, so they aren’t facing a depleted supply chain, but not so much that they tie up cash. With either approach, a close look at your current inventory processes is warranted.
If you can’t automatically balance supply and demand with a real time scheduling engine, or instantly understand your turnover and fill rates, then its time to talk to us.
REDUCE LOST SALES OPPORTUNITIES
The warning signs of lost sales opportunities are; customer service complaints because agents don’t have up-to-date information, stock levels not updating in real-time, or customers unable to access self-service information on your website.
Another flag is when trying to run sales campaigns, customer information can’t be easily collected or filtered for effective campaign targeting.
Getting control of these key capabilities will allow you to gain and retain customers.
Using a CRM solution enables you to capture information on prospects as they walk through your door, or your website, through each stage involved to the point where they become a paying customer.
It also enables you to track and trace orders, manage and record ongoing communications with customers and ensures your sales and services teams never miss a beat.
The other side of a CRM is that it enables you to continue reaching out to the prospects that didn’t make it into your customer book after their first enquiry. By targeting those prospects, you reduce the amount of effort involved in winning new business by increasing the rate of conversion from “just looking or enquiring” to long term satisfied customer.
FORECAST, FORECAST, FORECAST
What will happen to your cashflow if job seeker payments are stopped? What will happen if there is a surge in orders for a product or if a supplier isn’t able to meet demand? Do you have a “business quarantine” plan
Disruptions are happening up and down global supply chains right now, so manufacturers must prepare for swings and rapidly shifting demands. As the non-essential business community re-opens and office workers slowly start returning to offices, more manufacturers will ramp up production, placing increased demands on supply chains. Manufacturers will have to rapidly adjust all over again.
Normalisation of supply chains will take a while, so rapidly modeling worst case, best case and every scenario in between will ensure you’re prepared.
Forecasting known and unknown “what if” impacts enables you to prepare your business for foreseeable future events, as well as the unexpected, reducing the impact of swings in trading conditions or your operating environment.
WHERE TO START
If you’re currently relying on a mish mash of systems or spreadsheets that can’t give you this level of insight right now, then it’s time to talk to us about a single affordable cloud-based system.
A single cloud-based system eliminates on-premise hardware maintenance costs while ensuring your workforce can instantly access the information they need from anywhere. The right solution can improve your finances, is scalable, adaptable and allows you take advantage of robotics, the industrial internet of things, automation and anything else that will give you a competitive advantage.
There has never been a better time than right now to take-action and to take advantage of systems that are designed to ensure business resilience throughout these turbulent times.