Your Business Angels - Message to Client 2 – Spend more time thinking about your supply chain

Message to Client 2 – Spend more time thinking about your supply chain

19.10.2021

Nick, a client and friend of ours, gave us a “heads up” a few weeks ago on how bad supplies are getting, and he had a significant concern that goods he needs for his manufacturing business will be held up in port.

A review of managing materials on a job or in your business may change the way you run your business and organise your cash flow to allow for issues coming up.

Nick tells me he now works with far more suppliers, has had to make provision for the fact that all suppliers need to be paid directly, and that he needs to keep his clients up to date with new costs as prices rise.

Supply chain delays and soaring consumer demand have led to shipping containers backing up at Australian and global ports, meaning inordinately long wait times for consumers and making it much more expensive for companies to ship their goods.

This year sailors are struggling to deliver the massive amounts of goods that global consumers expect. That’s not just the result of a single mishap but vast and complex global supply chains.

Ships now carry about 11 billion tonnes of goods a year, equivalent to about 1.5 tonnes for every person on the planet. Port workers swiftly unload ships’ cargo, load them with new containers and get the newly arrived containers onto trucks and rail carts. Any mishap can cause knock-on delays.

Months and months of shipping disruptions resulting in part from pandemic-triggered overseas factory shutdowns, port congestion and shipping container and labour shortages have caused delays for all kinds of products.

A series of important forthcoming national holidays and festivals in China will only serve to deepen the crisis,

Consider what materials and goods you need for your business and short term work you have contracted for. Perhaps you need to get ahead on materials; even common or obvious items may be scarce for a while.

Also, factor in that other trades ahead or behind you may be struggling for items and that will hold you up or effect the timing of your work and eat into your costs.

From clients, we are also told the quarries are also struggling to stay up.

Know your supply chain well, it may no longer be a case of fronting up to the wholesaler when you need something.


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