Leveraging Supply Chain Alternatives – Why is it important to your business?
In today’s rapidly changing business environment, supply chain disruptions are increasingly common. As a result, companies realize the importance of having supply chain alternatives, including substitute products and sources to obtain their janitorial supplies, housekeeping supplies, and foodservice disposables.
Integrating supply chain alternatives into your business strategy offers a multitude of advantages, ranging from cost savings to enhanced sustainability. Let’s explore some compelling reasons to consider diversifying your supply chain:
- Cost savings: According to a report by McKinsey, companies that optimize their supply chains can achieve cost savings of 10% or more. By having supply chain alternatives, businesses can negotiate better pricing with alternative distributors and manufacturers, reducing costs and increasing profitability.
- Resilience to disruptions: The World Economic Forum estimated that the COVID-19 pandemic led to a 5% reduction in global GDP in 2020 due to supply chain disruptions. Having alternative distributors, suppliers, and manufacturers helps mitigate the impact of disruptions, ensuring business continuity and minimizing financial losses.
- Time to market: An efficient and agile supply chain with alternative options enables businesses to bring new products to market faster. According to a survey by PwC, 65% of companies suffered impact to their total supply chain lead time as the result of supply chain disruptions. In the same study, 79% of companies said they would implement dual sourcing strategy to mitigate supply chain risk. By having alternative product offerings and supply chain partners, businesses can respond quickly to market demands and gain a competitive edge.
- Sustainability benefits: A study by CDP (formerly Carbon Disclosure Project) revealed that 54% companies reporting their sustainable supply chain practices helps boost their organization’s competitive advantage. By diversifying their sourcing and partnering with eco-friendly suppliers, businesses can contribute to their sustainability goals and enhance their brand reputation.
- Customer satisfaction: A study by PwC found that 65% of customers consider supply chain transparency important when making purchasing decisions. By having robust supply chain alternatives, businesses can ensure a steady and reliable flow of products, leading to improved customer satisfaction and loyalty.
Implementing these strategies not only enhances your supply chain’s resilience but also paves the way for sustained growth and success. Collaborating with a specialized distributor can optimize your supply chain operations through harnessing their extensive product expertise, providing expert recommendations for product selection and utilization. Their established manufacturer and supplier relationships expedite product procurement, a critical asset in sectors like janitorial and environmental services where timely access to the right products is paramount.
Source: McKinsey & Company, “Building Resilience in Supply Chains,” October 2020.