The supply chain is the backbone of all business activities, directly affecting competitiveness and business efficiency. However, many midsize businesses are facing challenges in supply chain management, including fragmentation and complexity, leading to increased costs, limited visibility and potential risks. hidden. To overcome these difficulties, businesses need to focus on three main factors: adjusting supply chain strategies, minimizing risks and building a comprehensive management system.
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Align your supply chain strategy with business goals
To maintain profit margins in the context of rising inflation, leading businesses regularly evaluate and adjust prices and business policies. While large corporations have enough resources to respond to the situation, medium-sized businesses often have difficulty responding promptly.
A typical example is fast-food chains, where menu prices have skyrocketed by 80% since 2019. This shows the importance of accurately determining the impact of input price increases on selling prices and economic policies. joint.
Evaluate and adjust prices
To maintain profits, businesses need to regularly review and adjust prices to match changing input costs. This not only ensures that profits are not affected by inflation, but also helps businesses stay competitive in the market.
Review shipping policies
One of the important factors that need to be evaluated is shipping policy. Businesses need to carefully review policies such as “free shipping”, including application criteria, frequency of review and adjustment, as well as shipping fee calculation process. The role of the sales department in ERP data entry needs to be considered to avoid conflicts of interest.
Error analysis and supplier monitoring
An in-depth analysis of shipping policy errors can reveal significant losses. In addition, “all-in-one” control and payment for products and shipping by input suppliers also needs to be closely monitored. CFOs need to take a comprehensive view of current strategy, detect potential weaknesses, and leverage technology to maximize profits.
Mitigate risk through supply chain redundancy
Improving efficiency and expanding business scale is always the goal of the business. However, the Covid-19 pandemic has highlighted the importance of operational continuity, requiring businesses to build redundancy throughout the supply chain. Risk management includes identifying, evaluating and implementing measures to minimize the impact of adverse factors.
Assess your level of readiness
To assess a business's level of readiness, questions need to be asked such as: ability to respond to staff shortages, incidents with carriers such as closures, cyber attacks, embargoes or price increases . CFOs need to build comprehensive plans to identify weaknesses, propose solutions and apply technology to limit the impact of risks.
Develop a contingency plan
Developing a contingency plan requires businesses to consider every aspect of the supply chain, from raw materials to shipping the final product to the customer. Contingencies need to be established to ensure that the business can continue to operate on an ongoing basis, even in the face of unexpected events.
Applying risk management technology
Technology plays an important role in minimizing supply chain risks. Using data analysis tools and risk management systems helps businesses predict and respond quickly to emergency situations. CFOs need to invest in advanced technology solutions to increase redundancy and ensure supply chain continuity.
Build an integrated and optimized management system
A unified technology, data and process management system is an important factor to enhance competitiveness. Although many businesses invest in ERP software to manage inventory and sales, the ability to control and track the movement of goods is often limited. Supply chain systematization helps optimize the flow of information, goods and services, reduce costs, improve overall visibility and adapt to change.
Choose the optimal carrier
To achieve optimal efficiency, businesses need to focus on factors such as choosing the optimal carrier. This not only helps reduce shipping costs but also ensures that goods are delivered on time and in good condition. Companies should use data analytics tools to evaluate the performance of carriers and select the right partner.
Effective warehouse management
Effective warehouse management is a key element in supply chain optimization. Businesses need to ensure that inventory is managed scientifically, from ordering, storage to distribution. Applying modern warehouse management systems improves inventory accuracy, reduces waste and increases operational efficiency.
Control shipping errors and ensure data accuracy
Shipping errors can cause huge losses to businesses, from increased shipping costs to loss of reputation with customers. Therefore, businesses need to strictly control the transportation process, from choosing a carrier, checking goods to monitoring the delivery process. Ensuring shipping data is entered accurately into the ERP system is also an important factor to help businesses have an overall view of shipping performance and make timely decisions.
Strategic vision and effective implementation
Systemization is not a single project but a continuous process that requires strategic vision, clear planning and effective implementation. CFOs need to build a clear roadmap to systematize the supply chain, from assessing the current state, identifying elements that need improvement, to implementing technology solutions and tracking results.
In today's challenging context, the CFO's role is more important than ever. To enhance profits, CFOs need to focus on adjusting supply chain strategies, minimizing risks and building integrated management systems. Applying technology solutions and data analysis will help businesses make accurate decisions and optimize operational efficiency.
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