The answer will obviously be unique to your organization. That said, in our experience, there are a few common risk areas that many manufacturers tend to overlook. In the weeks and months ahead, it may be worthwhile to assess whether they’re prevalent in your organization so you can bolster your supply chain reliability moving forward.
Whether you’re relying on one supplier for all your metal needs, or a vast array of them, each route carries a certain amount of risk. Purchasing your metal from only one supplier can make you more vulnerable to delivery disruptions, inconsistent quality or that supplier’s financial shortcomings.
On the flip side, having too many suppliers can lead to inefficiencies. You may end up spending more than necessary—perhaps because you’re under- or over-ordering material due to complex record-keeping processes, or because you’re having difficulty keeping track of spending—which can come back to haunt you when the supply chain isn’t functioning at top capacity.
To mitigate these risks, it might make sense to use a service center when sourcing metal components. The right service center should offer you the best of both worlds—providing access to a wide range of suppliers, without the backend responsibilities of managing them.
Every time you receive a damaged piece of metal—such as a scratched sheet or bent metal bar—you need to take pictures of the damage, send the photos back to the supplier, wait for them to process the returns and then re-order new materials. This translates into lost time and money.
Quality agreements allow you to avoid the hassle. When you clearly outline your quality guidelines ahead of time, a good supplier can tag your materials accordingly and make sure only the right materials arrive in your warehouse.
Product design and development risk
In today’s fast-paced business environment, products can quickly become obsolete. To mitigate this risk, it’s important to make innovation a priority.
This may involve exploring different manufacturing methods to reduce costs, tweaking a product’s design to further differentiate it in the marketplace, or using a different alloy to enhance an existing product.
Understandably, this can be difficult to do on your own, which is why a fresh set of eyes can help. Some service centers will provide access to their internal experts—a team of professionals that can help you brainstorm new design and development opportunities to stay ahead of the competition.
As we’ve learned in recent weeks, a streamlined supply chain can make a huge difference when disaster strikes, but its benefits don’t end there. By mitigating supply chain risks and implementing the proper processes, you can eliminate operational redundancies and financial inefficiencies which, in turn, can help you make the most of the good times, too.