Biggest Step You’ll Take to Turn a Supply Chain into a Value Chain

Published : December 2, 2015

Supply-Chain-Value-Chain

It's a hard comfort to step away from the belief that supply chains flow one way, and do so without requiring input beyond basic ordering or invoicing. But supply chains cannot afford to be closed loops in the face of modern logistics. The supply chain is part of an incredibly intricate network, carefully balanced with success in mind. The emergence of the value chain concept, which highlights smart supply chain strategy as a source for operational cost savings, is directly tied to (relatively new) versatility and transparency efforts. Implementation, much like the goods within that versatile, new supply chain, draws operational inspiration and planning opportunities from an unusual source: customers.

A Rising Tide Lifts All Boats 

Logic dictates that if your customers do well, they will continue to order from you or move orders through your facility, as the case may be, thus securing an income stream for the foreseeable future. Too many fulfillment centers—even established, successful ones—make the mistake of turning a blind eye to the less-than-immediate shipment and fulfillment struggles of their largest customers. If a single company, group or even individual comprises a sizable piece of your outgoing shipments, they should be considered both carefully and individually. Ask for a sit-down and go over key points that may lead to an opportunity for co-creating value.

Ask questions such as:

  • Are you currently using any of our competitors in addition to our services? Why?

  • What can we do to secure that business from you?

  • Do we have any industry access, resources or contacts that we can extend to your benefit?

  • Can we offer advice or tips for any in-house shipping you currently do?

You may find that you and your customer share certain goals, or that the only obstacle to securing additional order volume is breaching the subject in a meaningful dialog about supply chain strategy. Your customers can't communicate problems, or ask for help, if they aren't given an appropriate forum in which to do so—it falls to you to create one. As the established service provider, you may be able to offer insight on making certain inter-agency processes more efficient, reducing cost and increasing turnaround time. Faster, more accurate shipments translate to a happy client, happy end customers, and finally, better sales for everyone over time.

Opening a Door

Networking, by its nature, is a two-way conversation and talking with your biggest customers may reveal opportunities that would otherwise escape notice.

Collaborating on shipping solutions can help keep your company in mind next time they're facing a unique fulfillment issue, or earn you a seat at the R&D table when they're discussing the feasibility of new product solutions. And, according to one Forbes contributor, co-creation may just be the best way to break up "antiquated status quos" and help usher in a suite of more modern solutions to recurring problems, such as poor order fill rates or shipping-damaged goods on the consumer side.  When you have a voice in that process when your biggest customers are revamping their systems, you'll be able to make suggestions that you know will work with your systems, reducing connection dissonance when the big day comes and speeding up viable implementation thereafter. 

Your supply chain strategy cannot cast your biggest sources of income as checkboxes—they must be considered as the variable, fallible and ultimately human sources they truly are. Treating your customers as a resource might feel a little unusual at first, but they offer a valuable point of insight, improvement and even criticism that you can't afford to pass up. Remember, if you aren't listening and engaging, your rivals are all too happy to pick up the slack.

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Topics: Supply Chain Logistics

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