Supply Chain Management in the Time of COVID-19 Pandemic

Overview

  • What is Supply Chain Management
  • Effects of COVID-19 on Supply Chain Management
  • Mitigating COVID-19 Impact on Supply Chain Management

What is Supply Chain Management?

Supply chain management means overseeing the entire flow of a good or service. Suppliers become links in the supply chain. And the products move from suppliers of raw materials to organisations that deal directly with users. Effective supply chain management minimises costs, waste, and time in the production cycle. Usually, suppliers restock retail shelves almost instantly. However, new challenges arrived with the COVID-19 pandemic.

Effects of COIVD-19 on Supply Chain Management 

Labour Shortages

Suppliers can’t fulfil orders due to labour shortages. This stems from lockdown protocols. Additionally, workers do not want to risk getting sick. As such, production is stalled and orders are unfulfilled. Further, the bullwhip effect is felt by many companies and distributors. 

Transportation Restrictions

There is a lower capacity for distributors to send goods. So, there is uneven arrival of raw materials. 

Understaffed Retailers

Staff become unavailable due to quarantine. Therefore, shipments slow down. Deliveries also become inconsistent. 

Lack of Demand

Inconsistent deliveries lead to fewer products on the shelves. As such, consumers demand less. Additionally, there are increased costs for deliveries and other processes. And this makes it difficult to keep up with spikes in demand.

Lack of Delivery Options

Consumers are harder to reach because they avoid shopping. Moreover, delivery timelines take longer. And demand patterns become inconsistent. 

Mitigating COVID-19 Impact on Supply Chain Management

Keeping More Inventory on Hand 

Easily address problems with stalled production and longer delivery times by keeping more inventory on hand. Now, for some, this might seem like a more costly idea. After all, more inventory means more space. However, the simple task of space optimisation can help you avoid extra costs and still address COVID-19 problems. 

Space optimization helps you avoid waste in your warehouse. Moreover, it decreases costs because an efficient space increases throughput. Automating your warehouse helps you optimize space for warehouse efficiency. Some conveyor belts are specially designed to maximize current floor space. A WMS helps you avoid excess inventory, too. This way, there will be little need for additional storage space.  

Increased Use of Warehouse Automation

Warehouses cope with inventory counts, speeding order delivery and implementing social distancing to keep operations running. By integrating warehouse automation, they can meet the challenges brought by COVID. An integrated inventory management system goes a long way in solving labour problems and managing inconsistent spikes in demand. 

Scalable Processes and Picking Strategies 

Some warehouses are overwhelmed with orders. Yet, others are left with an abundance of inventory. Thus, this proves that there are fluctuations in demand which cannot be predicted. With tailor-made software solutions, picking strategies can handle peaks in demand. 

Supply Chain Digitisation for Faster Decision Making 

Planning is a time-consuming process. With the way COVID is affecting business, decisions need to be fast. But, too often, data remains in spreadsheets and emails. Countless hours of planning make sure this data is accurate. However, companies streamlining and digitising planning processes make plans faster. Moreover, most software provides various, insightful reports that the company can use. 

End-to-end Supply Chain Visibility 

Managing logistics is a high priority for companies now. Companies with digital supply chains perform better as demands grow. AI (Artificial Intelligence) and automation centralise data for all shipments and inventory. AI involves analytics engines that sift through all incoming data and highlight situation changes. Then, staff use this to adjust priorities and create possible solutions.

Applying Lean Manufacturing Techniques

Supplier availability and capacity are the top two things COVID affected. Lean manufacturing techniques help in supplier management and existing processes. Over time, some processes and documents remain even when they are no longer useful. Removing these activities improve responsiveness and cut cycle time.

As we adjust to the new normal, companies create backup plans for their backup plans. Additionally, operations become as unpredictable as the future. As such, warehouses look for adaptable and flexible solutions. To help you come up with the best solutions for your company and help you efficiently manage the impacts of COVID-19, contact Qbasis today! 

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