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5 Reasons Why Supply Chain Visibility Is Important for Your Business

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In a world where goods are produced and sold, the supply chain is a valuable asset. While technological advancements have made the supply chain function more efficiently, there is still much work to be done in this field of study.

In order to improve efficiency, businesses must track their goods from point A to point B effectively so that they can make changes when necessary. Without this vital information, it can be difficult for businesses to plan for future success.

What Is Supply Chain Visibility (SCV)

Supply Chain Visibility (SCV) is the art of making decisions about what raw materials to purchase, who to outsource manufacturing to and where to source materials based on real-time information. This information can include market trends, competitors’ price movements, bulk pricing, product demand forecasts and more.

There are two levels of supply chain visibility: low and high visibility environments. Supply chain planning is the process of coordinating the entire supply chain to improve supply chain visibility. Visibility technology can help organizations track and manage their supply chains more effectively.

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Supply Chain Visibility (SCV) allows business leaders to make informed decisions about the future of their organization’s supply chain. Supply Chain Visibility (SCV) enables the tracking of inventory from the raw material stage all the way through shipping; maximizing profits by preventing losses from spoiled inventory and over-producing.

Supply Chain Visibility (SCV) also enables companies to make better decisions on which products and services to produce. It is never a good idea to buy too much of a product, only because you may want to sell it later on at a higher price.

Supply Chain Visibility (SCV) allows for managers and businessmen to create optimized inventory-use plans, thereby preventing excess from being produced, which in turn minimizes the unnecessary purchase of raw materials/materials and ensures that the goods will be produced when needed.

When the COVID-19 pandemic began in January 2020, 3M began dramatically ramping up supply chain activities to meet the skyrocketing demand for N95 masks.Here are five reasons why your business needs visibility into its supply chain:

1) Cost Savings

When production costs rise beyond normal rates and stay high, companies must do something about it before the next round of rising production costs hits them hard during peak season.

Many companies have found that the answer to this problem is to look at the whole supply chain and put a plan in place to ensure that production costs do not rise too high. Because this requires a company to take an overall look at every aspect of its business, it will result in cost savings for your company.

2) Employee Satisfaction

One of the most crucial aspects of a business is keeping its employees happy. Without high employee satisfaction, there will be issues with retention, employee turnover and morale. It is important to know what your employees are saying about their jobs so that you can make changes that make them more satisfied with their work environment.

3) Custom Manufacturing

It is important to know how much everything costs in order to make sure that you do not go with a lower-cost option. With the ability to track products all along their supply chain, your company will be able to make better decisions as far as what is being produced and in what quantity.

4) Time Management

For companies that hold a lot of inventory and need it for sale at times when customers want them, managing time is essential. Knowing the time it takes for products to move from point A to point B is critical because you have a much better idea of when customers can expect their orders when they are needed.

5) Infrastructure Improvement

Much of the current supply chain network can be outdated and inefficient, which can make the flow of information difficult. For example, the Internet is a great way for businesses to pre-plan what needs to be done and how it will be done.

However, there are many times when this is not beneficial, and many times when it actually makes your job more difficult. With the ability to track products all along their supply chain, your company will have a better idea of what needs to be improved in order to function better.

The supply chain is an integral part of your business because it controls the flow of goods from manufacture to sale, and everything in between. With improved visibility into your supply chain, you will have a better idea of how to run a cost-effective business by identifying those parts that are not functioning at optimum levels.

Why is Supply Chain Visibility Important

Because the supply chain is such a critical aspect of any business, it is important to know why it is so important to your company. Here are five reasons why visibility into the supply chain is so important:

1) Increase Sales

28 per cent of companies found that being able to pinpoint where products are in their supply chains helped them increase sales. With better visibility, you will have a better idea of how many units need to be produced for sale during a given season or time frame. This will help you reduce loss by selling the proper amount of products instead of overproducing with no one looking to buy them.

2) Improve Productivity and Quality

When you are able to track products in the supply chain, they will reach their destination with no errors. This means that if product A was not properly produced, it will not be shipped out.

With improved efficiency in your manufacturing process, you will improve your overall performance and be able to meet higher quality standards without holding back production levels because of quality concerns.

3) Create Products

If a business is trying to create a new product for sale or for use in its own business, the supply chain is essential for understanding how long it takes for each step in the process to take place. Without the ability to track products all along their supply chain, you will have a difficult time creating products that are right for your customers.

4) Reduce Costs

Many companies hold inventory because they need it at certain times of the year. Without understanding how long it takes to get inventory from point A to point B, you can overproduce and end up holding a lot of goods that you cannot sell before expiration. This will result in a lot of waste and cost your business extra money with no return on investment.

5) Customer Service

With customer service being such an important aspect of any business, it is critical that you do everything possible to ensure that all customers are satisfied with what they are getting from you. One way to do this is by being able to track products all along their supply chain, so you can better understand how much inventory to buy and when.

Without any visibility into your supply chain, you will be unable to make the right decisions with regard to how much product needs to be produced and when. The more your business operates efficiently, the more successful it will be in the long run. All of this comes down to supply chain visibility.

The Best Software for Supply Chain Visibility

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The US government made ELDs mandatory in December 2017, although they are still being adopted at a slower rate in other parts of the world. To get the most out of supply chain visibility solutions, you will need to determine which is the best software for doing it. Right now, there are a few software options you can use to view your supply chain.

1) Cloud-Based Software

For many businesses, working with a cloud-based solution is ideal because it means that they can access their data from any device with an Internet connection. Cloud-based software allows businesses to add more visibility and make better decisions about how to function better in the future. Some of the cloud-based solutions in use today include Sapien, Visibility360, SAP S/4HANA and Scan group.

2) On-Premise Software

This option is often used by companies that already have an IT department that supports their operations. With on-premise software, businesses will be able to do most of the same things that they can do with cloud-based software.

However, most on-premise solutions will cost a lot more than cloud solutions. Some of the options for on-premise include Epicor, Infor, JD Edwards and Oracle Supply Chain Execution Suite.

Cloud-based supply chain visibility solutions provide businesses with the ability to access information from any Internet-enabled device, which is convenient for those who need it at any time during the day.

How Can Supply Chain Visibility Improve Your Business

Within a year of investing in the new technology, Pixelle’s leadership noticed that emails received by load planners, carriers, and customer care departments attempting to locate a specific cargo had been cut in half.

Now that you know why supply chain visibility is important to your business, how can you improve it? Here are a few tips you can use to make progress in this area:

1) Use Predictive Analytics

Predictive analytics will help you determine whether goods are being produced in the proper amount that you need them. Using this information, your supply chain will be able to run more efficiently and reduce waste.

2) Work with Global Suppliers

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When you have more information about what it takes to produce a product, your suppliers will be able to increase their production abilities by increasing efficiency. If your business is dealing with a lot of time-sensitive needs, it is likely that they will have fewer products than usual to produce each day. You will have to make sure that you plan ahead when you have issues with supply chain visibility.

3) Become Data-Driven

The data used to run most supply chain visibility solutions is built from the information that you collect about your business. By being more data-driven, it will be easier for you to understand why certain parts of your supply chain are not working properly and focus on areas where improvement is needed. This will help you improve your performance as a business, which will mean more revenue for your company.

4) Work with Suppliers

Many businesses find that working with their suppliers can be very important in improving their performance. When you work with your suppliers to improve their production levels and the quality of their products, it can help you when it comes to reducing waste in your supply chain.

5) Upgrade Your Inventory Management

When your supply chain is working inefficiently, it can result in excess inventory being produced and held in inventory that is not sold because there was no demand for them. You will also find that you may be buying more products than what your customers need. By paying attention to how much product needs to be produced, you will be able to reduce inventory waste and have more inventory available for sale when the time is right.

7) Look at Your Costs

If a supplier is taking too long to produce goods for you, this can increase the amount of money that you pay for those products. By working with your suppliers to reduce the amount of time it takes for them to produce your products, you will be able to get them faster and reduce costs.

8) Use Technology

While it is important that you work with your suppliers on improving the amount of time it takes them to produce your products, there are also certain technologies that can be used. Technological advances have made it possible for businesses to have more visibility into their supply chain and make better decisions about how they should operate in the future. There are a variety of solutions that can be used depending on how much you know about what is going on in your supply chain.

The Benefits of Supply Chain Visibility

When used properly, supply chain visibility can provide a wide range of benefits to organizations. Among the main benefits are:

1) Better Organization

Without the right amount of supply chain visibility, you will not know if you are buying enough products to meet your needs and to sell what is left over. With the right amount of supply chain visibility, it will be easier for you to get more organized and plan ahead for unexpected events in your business.

2) More Revenue

You will benefit from being able to better manage your supply chain by being able to get new customers because they have access to your products when they need them. You will also have time to focus on other areas of your business, which can result in more revenue for your company.

3) Better Suppliers

When you have the right amount of supply chain visibility and make sure that you are asking for what your customers need, you will be able to work better with your suppliers. This will allow you to increase the number of products that they are able to produce each day and reduce the number of products that may not be needed or sell quickly.

4) Simplified Ordering

When you order products from suppliers in your supply chain, there is a chance that the wrong amount of product is being produced because there is no information available about how much should be produced each day. When you have the right amount of supply chain visibility, you will be able to order the amount that you need and reduce the amount of excess production.

5) Better Customer Relationships

When you can better meet the needs of your customers and get them products as quickly as possible, they will be more likely to come back to buy more products in the future. Using customer relationship management software can help you find out when items are becoming popular and plan ahead for when they are needed.

6) Improved Production

If there is a certain product that is time-sensitive or needs to be produced in high quantities, being able to monitor your supply chain will allow your business to produce this product properly and reduce waste.

If a product is not being produced in the proper amount that you need them, or certain ingredients are being used instead of others, it will be easy to make changes to how things are produced.

7) More Information

With the right amount of supply chain visibility, you will have more information available about what is going on in your supply chain. This will make it easier for you to find out why there may be a delay in the production process and what needs to be done differently in the future. If there is less supply chain visibility, it will take longer for you to get this information and figure out what needs to be adjusted until something goes wrong again.

Challenges of Supply Chain Visibility

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The supply chain efficiency should be as high as possible. This usually means streamlining processes and improving supply chain visibility into the supply chain data that drives supply chain processes. There are many supply chain software solutions available to help with this, but they are only as effective as the people using them.

The main challenges of Supply Chain Visibility are the inefficiencies caused by the lack of information and communication. The information to optimize your supply chain is too difficult to gather and transfer, or too costly to maintain with all the technology required.

Other than that, supply chain visibility is always under threat with new technology taking over and changing everyday operations. According to a 2017 poll, only 6% of businesses felt they had achieved supply chain visibility.

Supply chain leaders know that high supply chain visibility is essential to good business operations. By having full supply chain visibility, they can identify potential problems and address them quickly and efficiently. Good supply chain visibility allows them to keep their businesses running smoothly and avoid disruptions.

Supply Chain Visibility (SCV) helps companies avoid losses from spoilage. Companies can minimize spoilage by using knowledge. Companies can avoid spoilage by understanding their product’s demand curve, creating a forecast for global demand, and understanding when to find inventory online to minimize the cost of storage as well as time for filling orders.

Last Updated on October 12, 2023 by Priyanshi Sharma