Supply Chain Network Design is a crucial process that involves strategic planning and modeling of supply chain operations to optimize cost and time, using the available resources. In today’s economy, having an optimal supply chain network design is critical to deal with supply and demand uncertainties across various tiers of the network, as well as to be cost-efficient.
Organizations can achieve several key objectives by focusing on their supply chain network design, including optimizing and improving inventory visibility, improving speed-to-market, increasing service levels such as on-time in-full (OTIF) performance, and accessing cost-saving opportunities such as reducing working capital, logistics costs (such as freight, transit time, and handling), labor costs, purchase costs, and inventory. Additionally, evaluating optimal costs for fixed assets such as facilities and equipment can help organizations better manage their resources. Improved coordination among suppliers, distributors, and logistics partners can also enhance supply chain efficiency, while risk mitigation strategies can help organizations prepare for unforeseen circumstances.
Given recent events, it’s become clear that the supply chain is the backbone of businesses. To meet uncertainty in the market and rapidly shifting consumer choices, organizations have shifted their focus to building a strong and resilient supply chain that is future-ready and oriented to market needs. Several factors play a key role in prompting organizations to evaluate their supply chain network design, including short-term factors such as:
- Addressing capacity constraints in existing facilities
- Reducing obsolete inventory
- Responding to unforeseen events such as natural disasters
Mid-term factors may include:
- Evaluating new sales opportunities for large additional volumes
- Expanding into new products/markets
- Shifting emphasis from retail to B2C.
Long-term factors may include:
- Evaluating new merger and acquisition opportunities
- The expiration of existing contracts/leases (e.g., 3PL contracts)
- Planning for future expansions (adding additional facilities, plants, etc.)
- Strategically planning network changes over a 3-5 year roadmap.
Although there are numerous technologies available for analyzing data and generating what-if scenarios, Supply Chain Network Design remains a complex process that requires organizations to establish key objectives and align them with business goals through systematic planning. It’s important not to be overwhelmed by the amount of information available in the market and realize that network design is a continuous process. Bricz can help organizations navigate this process and achieve optimal results. By partnering with Bricz, organizations can benefit from expert advice, customized solutions, and advanced technologies that enable efficient network design and optimization. Don’t wait to start the process – get started today with Bricz.
Contributor: Sahiti Kalapala, Senior Supply Chain Consultant at Bricz