Small Businesses Hit By Supply Chain Woes Spending More To Overcome Issues
Tuesday, October 12th, 2021
In the midst of having to navigate waves of COVID-19 and lockdowns, 87% of small to medium-sized businesses (SMBs) have maintained, or spent more, on transportation, logistics, and expediting to overcome shortages -- this according to the "Logistics: Heads Up" study from Cargo, and their research partner Phase 5.
The survey of 1,154 small business owners across North America highlighted the fact that COVID is still causing supply chain instability for SMBs. The study also showed that as they seek to find different avenues to secure supply, only 44% of SMBs are getting their shipping and logistic services from a single vendor. This was surprising insofar as past "Heads Up" studies indicated SMBs are very likely to "sole source" services and assets such as financial services and commercial vehicles.
Toby Stansell, CEO of Cargo, offers the following tips to help SMBs strengthen their supply chain:
- Dual/tri-source all critical raw materials, components, and sub-assemblies.
- Balance purchase order placements and order volumes between two or more competing suppliers.
- Develop a geo-diverse sourcing model and supply network.
- Increase your purchasing clout and buying power by joining a Group Purchasing Organization.
- Prioritize predictable and reliable availability over marginal cost differences.
- Reengineer products and processes to utilize more readily available components, technology, or labor resources and skillsets.
- Invest in a simple, cloud-based sales forecasting, demand planning, and inventory replenishment software that can easily interface with your primary suppliers' systems.
With offices in Greenville, SC and Toronto, Canada, the 65-employee Cargo has been delivering advertising and marketing solutions and services to clients since its founding in 2006. The agency specializes in connecting big brands with small to medium-sized business customers, and services some of the world's largest and best-known companies. Cargo was named one of the nation's fastest-growing private companies by Inc. Magazine in 2020. You can learn more about Cargo and the "Heads Up" studies at http://www.thecargoagency.com