Fluctuations in international supply chains are often a problem in the global economy, and as of this writing, it seems to be getting worse. Business owners everywhere have to re-learn how to source and distribute their products with every new rise in industry demands and global shortages, while doing their best to maintain prices and availability for their loyal customers and clients.
Here at SendCutSend, we work closely with our business customers to help them through material shortages while navigating the ever-changing economy ourselves, and we’ve picked up a few tips over the years. Keep reading for our best practices for dealing with materials shortages as a business.
1. Be prepared with alternative sources
Obviously the biggest problem with raw materials shortages is the reduction of your business’ ability to sell finished products. Running out of raw materials with no alternative source is an easy and preventable way to lose out on revenue streams.
Quote materials from several suppliers so you have multiple potential sources for your raw material, and be prepared to utilize several of them when your regular supplier runs into shortages. Keep in mind that if you go this route, you may need to alert your customers to a potential change in raw material quality. If no alternative source exists or you are unable to order the same material from any of your sources, you’ll need to look into a temporary redesign or reformulation of your product.
2. Stay up to date on global supply patterns
Global supply chains follow trends that allow you to roughly predict the rise and fall of materials shortages. Simply staying up to date with current events and being aware of your supply origin is the most effective way of predicting a coming material shortage. Professionals in any industry and at all levels should be aware of current world events for this reason. If you, your employees, suppliers, and others in your business’ network are able to predict large scale shortages simply through watching the news, it will only become easier to navigate those shortages as they are happening.
For example, SendCutSend keeps a range of thicknesses for Baltic Birch, a plywood sourced from the Baltic region that includes Ukraine and parts of Russia. As we watched as the current conflict unfold, we stocked up on as much Baltic birch as we could. Staying up to date with current events and predicting supply patterns using that information allowed us to adjust our approach to this material and prepare our customers for any changes..
Business owners and purchasing managers should not just keep an eye on global news, but industry blogs and networking groups as well. Communication within your industry and its suppliers is vital to your business success amidst material shortages.
Outlets for supply chain news:
- Global News: Associated Press
- Industry specific networking: LinkedIn Groups
- Industry specific news and information: Business Wire News by Industry
3. Plan as early as possible
If you utilize alternative sources and follow your industry network to stay up to date on global and industry supply trends, you should be able to plan for shortages and rises in demand earlier than most. There is only so much money and space you can invest into stocking up on raw materials, but preparing your customers for a change in material type or quality, as well as adjusting with your suppliers well in advance, will give your business solid ground to stand on when the shortages are affecting others.
For example, here at SendCutSend we work with 3 to 4 vendors for every single material we stock. We do this specifically to ensure we continue to stock those materials even if one or more suppliers is experiencing a shortage. We set up accounts and terms with each vendor ahead of time, our purchasers familiarize themselves with their ordering system, and we may even have blanket POs just so we’re prepared.
Planning ahead could allow you to adjust your products to accommodate different materials or come up with cost effective solutions to material storage problems. No one wants to raise prices and negatively affect their customers, and being able to predict and plan ahead can help prevent that.
Tips for preparing in advance for shortages
- Plan with another business owner to share raw material supply
- Plan for material alternatives
- Find a third party to outsource to
- Prepare communication to customers for when your supply is gone
4. Outsource manufacturing to SendCutSend
Here at SendCutSend, we work through material shortages through long term planning and forecasting. Our materials have no shelf-life and we’ve invested in the long term storage of these materials to ensure that when shortages come, we’re significantly less affected by them. We can absorb price shocks better than most manufacturers navigating materials shortages, making your parts as affordable during shortages as they are during times of abundant supply. If we find that we’re temporarily unable to source your needed material, our support and production teams will help you find a way to adjust your designs as needed to suit the current industry demands.
In the volatility of today’s economic climate, even we still run into issues with material shortages. But with our alternative sources, understanding of the global supply chain, and ability to predict and plan for the long-term, we are best equipped to give your business the best chance possible of surviving and thriving in the face of shortages. We want to see your business succeed no matter the circumstances, so we’ll work closely with you to ensure your products are as unaffected as possible by changes in the supply chain.
Start with SendCutSend today and get ahead of the supply chain
SendCutSend has a history of helping businesses make the most of our manufacturing services to reach a new level of success. We want to help you do the same. If you have any questions about utilizing SendCutSend for your business manufacturing, don’t hesitate to contact us. We’ll set you up for success with our precision laser and waterjet cutting, as well as our bending, tapping, and powder coating services.
If you already use SendCutSend for your business but want to know how to adjust your designs to circumvent supply chain issues, reach out to our support team and we’ll answer any questions you might have!