Survive the supply chain crisis with an ERP
30 March

Survive the supply chain crisis with an ERP

Disrupted supply chains and rising costs currently affecting manufacturing and trading companies were first triggered by the pandemic and now exacerbated by the war in Ukraine. The latest reports on the business climate are causing many companies to switch to crisis mode or at least to deal intensively with an intensification of the crisis. Luckily, companies that have a solid ERP system have an important tool in hand. Automated inventory management can be essential for businesses impacted by disrupted supply chains looking to weather these uncertain times.

Factors responsible for the current supply chain crisis

In many companies, numerous parties are involved in the supply chains. This includes suppliers, partners and distributors, customers, third-party logistics providers, warehouse operators, transport companies, e-commerce providers, retailers and financial institutions. The flexibility to react to fluctuations in demand is essential for a functioning supply chain. However, with the increasing impact of COVID on global markets, the movement of goods across countries and continents has been severely hampered. However, the current supply chain crisis is not solely due to that Pandemic attributed. Other factors are

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Changed trade policy

In the recent past, after a long period of time, import tariffs imposed by government agencies around the world have been increasing, which has already had an impact on many industries. Special effects such as Brexit exacerbated these effects. The global trade structures are therefore increasingly changing, and companies are faced with higher costs and uncertainties when dealing with foreign partners.

Online sales channels dominate

In addition, some companies were also affected by the increasing replacement of brick-and-mortar retail by the Online trade caught on the wrong foot. It wasn't just the old sales channels that were weakening, the increasing price transparency caused by transparency on the Internet was also reducing margins.

Rising commodity and energy prices

The most recent DIHK business survey showed that two-thirds of companies in all sectors and regions see the rising prices for energy and raw materials as a significant business risk. In the industry, even 85% see it that way. That was before the start of the war in Ukraine.

How the right (configured) ERP system counteracts the disruptions in the supply chains

One of the first steps companies should take to weather the current disruptions and ensure smooth post-pandemic trading operations is to invest in their existing or upcoming ERP system.

Improved inventory management

As always, if you have a ERP system wants to optimize to automation. A company that automates inventory management can save time and money. The aim is to increase efficiency in all areas.

  • Inventory Management Accuracy
    While in the past much depended on the experience and decisions of the individual employees, you can now rely on the calculations of the software. This leads to an improvement in the reliability and quality of your inventory management. The integrated inventory management also takes into account the best practices for your business and avoids human error.
  • Inventory management scalability
    Medium-sized companies in particular miss out on possible growth opportunities without smart IT support. A modern one merchandise management software helps you to identify growth areas and protects you from losses.
  • effectiveness and transparency
    Whether it's time-consuming calculations and data analysis that employees used to have to do, integrated software can do it faster. Operating the software also increases the transparency of the entire supply chain. Customer orders can be processed more quickly and supplier orders can be triggered more quickly. At the same time, you always have an overview of processes or fault reports.
  • time saving
    If your inventory management is automated, your employees can Purchasing spend valuable time on other important activities. You can take on new projects and new market segments, and focus on revenue and growth instead of editing data by hand.
  • cost cutting
    Cost is an important consideration when it comes to implementing professional inventory management. The ROI of such a system is often underestimated. In the long term, significant savings can be achieved here on several levels. The software can help, for example, to keep stocks as low as possible without jeopardizing the ability to deliver.

Efficient management of complex supply chains

Many companies are highly dependent on partners (e.g. freight brokers, shipping companies and carriers) who play an essential role in their processes and logistics. The problem for many companies is that these service providers are often not transparent in the handling and flow of their own goods. With an advanced ERP system, such partners can be relied upon interfaces connect and ensure seamless data exchange. On the basis of the joint data, a continuous analysis of important key figures can be carried out logistics take place.

Higher customer satisfaction

Improved warehouse and inventory management ensures optimized delivery readiness and thus better and often faster processing of customers. However, the data provided can also be used to inform customers about the status of their orders and deliveries. A significant contribution to customer loyalty.
The customer data can also be used in combination with an integrated storage system to optimize the storage place deliver based on forecast demand.

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