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Supply Chain

For many companies, supply chain management involves a lot of missed opportunities. Instead of having a supply chain that adds value, they have one that is full of oversights and systemic mistakes that cost the company time and money.

Even if your company’s supply chain is running relatively smoothly, you might still be missing opportunities to optimize your supply chain. Diagnosing these mistakes can be difficult, but in paying attention to the red flags, you can understand missed opportunities in your day-to-day common practices.

Developing an efficient supply chain management strategy will help cut costs and increase profit margins. In addition, improving the supply chain and related business processes helps your company plan for the future, adapt to changes, and improve customer service.

Here are Some of the Most Common Supply Chain Errors:


1) Lack of Supply Chain Transparency

Consumers are increasingly demanding greater supply chain transparency from brands and retailers and yet companies are still operating without complete end-to-end visibility into their supply chains. In a transparent supply chain, every stakeholder has access to detailed information on the origin and status of each raw material, item, ingredient, and product. Transparency underpins consumer trust — a vital element when the safety supply chains are under scrutiny.

2) Ignoring Supply Chain Data

Big data is important at every stage of your business. From transactions, product testing data, logistics, pricing agreements, material cost or tacit data such as email communications between teams, all information is important.  Companies need to examine which kinds of data can be used to make better business decisions, which will help them create appropriate strategies for capturing, storing and analyzing data.

3) Failing to Plan for Business Disruption

Supply chain disruptions pose a significant risk to businesses of any size. Even the most well-prepared organizations may fall victim to unforeseen factors out of their control, such as geopolitical actions, natural disasters, and cyberattacks. Having supply chain risk plans in place is key to running a smooth business. Many businesses are not prepared for the potential supply chain disruptions that affect their bottom lines when they have trouble obtaining raw materials or getting finished products through ports. When the inevitable happens, you will be prepared to keep your customers from being affected.

4) Choosing Too Many Partners

Although you want to be prepared, there is such a thing as having “too many cooks in the kitchen.” If there are too many contractors, too many suppliers, too many shipping companies, so on and so forth, you introduce more complexities than the reduction of risk is worth. Investigate and find your right balance. Too many partners can lead to a significant amount of added complexities that may actually increase the risks that you are hoping to mitigate. A multiple contract manufacturer product launch means that the brand owner is now responsible for managing two of everything; a process far more complex than simply doing the same things twice.

5) Ineffective Cost Reduction

Struggling to reduce costs is a battle that every organization is familiar with in some way. And as time goes on, once all the easy cost reduction has been gained, it can become increasingly difficult to reduce costs even further.

An easy and effective way to reduce costs in supply chain management is to reduce how many times your products are ‘touched’ or handled between being received from the supplier or factory and eventually delivered to the customer. Every time you touch a product, you incur equipment costs, damage costs, labor costs, and more. So, think about eliminating unnecessary steps or introducing some automation.

6) Lack of Cyber and Physical Security Controls

There is an alarming lack of intellectual property security measures in our industry and country. Utilize secure file transfer protocols, and implement restricted access. Also, consider physical security barriers (locks and seals) to decrease product tampering. Security compromises can be kept to a minimum by employing secure supply chain data, measurement and reporting architecture, in addition to a solid understanding of collection points and repositories for any sensitive data.

7) Failing to Create Effective Vendor Relationships

Price is not the only factor when negotiating with vendors and companies must be careful to consider other areas such as performance and customer service. Find a vendor not just offering the lowest price but one that is willing to be a partner and offer solutions to assist with your supply chain issues. Those types of vendor relationships yield so much more to the bottom line as it relates to reduction in inventory, employee performance and increased throughput.

8) Poor Customer Service

If you are not creating effective relationships on both ends of your supply chain, then you are creating barriers that are stifling your company’s bottom line. Both vendors and customers are key to your company’s success. The better your relationships with them, the better your supply chain management will be.

The FLEX Logistics Team is Here to Help!

Our team understands the importance of getting your products to the market. That is why we aim to understand your business and build lasting relationships with you and your team. ​Whether you are looking to add a new warehouse to your existing operations, growing and need to increase your distribution efforts, or starting a new company, FLEX has the solutions to meet your supply chain needs.

Contact us today to discuss your current and future warehousing and logistics needs.  We will work together with you to understand your requirements and develop a solution that will set you up for future success.


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