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Tip For Building An Effective Supply Chain By Streamlining Freight Management
According to a study, the COVID pandemic "significantly impacted 80 percent of supply chains throughout the world, resulting in 47 percent of supply chain processes being overhauled" and "55 percent of firms downgrading their growth outlook." Thus, the pandemic demonstrated how susceptible most supply chains are and how important it is to growth goals.
Fremont, CA: Building a sustainable supply chain has taken on new significance in a post-pandemic world. According to the research, it's especially true that it anticipates the supply chain interruptions to occur every 3.7 years and to last at least a month. Nothing beats being too prepared to deal with interruptions. Aside from risk reduction, a successful supply chain provides a competitive edge for SMEs wanting to grow their business and capitalize on market possibilities. It positions a company to transform a crisis into an opportunity and increase market share, a critical success criterion.
Building an agile, robust, and sustainable supply chain ecosystem relies heavily on the efficiency of freight procedures, regardless of industry.
Let's look at some of the ways that optimized freight management may help you establish a more sustainable supply chain:
- Leverage digitization and automation
Digital technologies and online-enabled procedures in freight management have the potential to have a considerable impact. It simplifies the freight procedure and lowers friction in the flow of the process. It creates new potential for proactive freight planning, coordination among various operational partners, and a single version of the truth throughout the freight value chain.
A unified linked solution or platform will improve the efficiency of quotation gathering, booking, shipping management, and information flow for informed decision-making.
- Gain end-to-end visibility
Inefficiency and greater expenses result from a lack of visibility. Shippers are unable to estimate the consequences of an occurrence, making informed and rapid decision-making difficult.
Visibility is a management technique that may be helpful to improve freight planning, operational efficiency, and cost reduction. It tracks and documents the cargo's chain of custody, reducing the risk of revenue loss due to fraud or missing shipments.
- Working capital management
The soundness of a company's working capital is its first line of defense against supply chain interruptions. A proper working capital position equates to greater resilience in the face of market shocks. The difficulty in keeping one is that both the customer and the supplier attempt to maximize their cash flows in opposing directions. Suppliers prefer to get paid as soon as feasible, whereas purchasers want to postpone payment as long as possible.
One approach to bridge the payment gap between these parties is through the supply chain or trade financing.