From supplier to customer: 5 challenges in the supply chain

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The importance of a company’s supply chain should never be underestimated. The supply chain is, after all, the lifeline to product supply, stock control, sales and thus company profitability. However, there are many factors that make managing the supply chain very difficult. The key to dealing with them successfully is to understand them and how they arise before you can mitigate them. Let us investigate five of these challenges further.

Trustworthy suppliers

The supply chain is built on the trust of suppliers who fulfil your orders in a timely and reliable manner. Likewise, your customers rely on you to do the same. The supply chain will therefore fall flat if any side of this relationship was to become unreliable. Developing a reliable supply chain that is built on loyalty and trust can be a long and tedious process. However, by putting in the effort at the beginning to approve your suppliers and cultivate great relationships with them, will be extremely beneficial in the long run.


Companies are facing a global tension where prices of competitors become ever more, just that, competitive. Globalisation can be especially hard-hitting on small to medium enterprises. Companies are forced to retain or lower current prices to remain in the competition, however, they also must shoulder increased global costs such as shipping and storage. The net effect is that they simply must accept a smaller profit. To remain competitive, a company must absorb increasing operating costs or they should invest more heavily in innovative research to ensure they are always one-step ahead of their market competitors. Both of these outcomes erode the bottom line and create a new set of problems for the company.

Market growth and innovation

Growing the market through things such as innovation and cost-worthiness is a huge challenge to companies and their supply chain. They must either begin similar processes to other companies quickly, essentially doing it better for less; or they must be consistently developing innovative products. This exerts a huge amount of stress to perform on the company and new product development can be very lengthy, costly and difficult to actually carry out to market.

Global risks

There are global risks that represent a massive challenge to supply companies. The more globalisation that occurs, the more vulnerable companies become to these risks. They include things such as natural disasters, war, crime, economic recession and competition. Companies rely so heavily on foreign customers, worldwide sourcing and freight and so are extremely negatively impacted by the risks mentioned. In order to mitigate these risks, a company could decide to source and supply predominantly locally, however this presents its own challenges and can reduce the company’s customer-base and profits. A better plan could be to identify all these risks and manage them appropriately through alternative suppliers, alternate shipping routes or ensuring clauses are included in the contract to provide lenience in these circumstances.


Lastly, a significant challenge of supply chain management is to attract appropriately-trained staff with knowledge and expertise in procurement and supply management. It can be extremely difficult to identify the skills required in individuals, which are unique and highly sought-after, and can often result in a huge training investment. This can be attached to its own risk, which is that of losing highly trained and financially valuable staff.

What can you do to solve supply chain challenges?

If you are experiencing supply chain challenges and are at a bit of a loss as to how they evolved or what to do, do not fret, it is very common and there is support available. A key component to supply chain management is effective inventory stock control as they are so intricately connected. A tool which can be exceedingly powerful in inventory stock control is online inventory management software. It can be very straightforward to access and download inventory software and by taking care of that dilemma, your company is far more equipped to consider the supply chain as a whole and how to deal with challenges and optimise it for ultimate success.

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Melanie - Unleashed Software

Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. Melanie has been writing about inventory management for the past three years. When not writing about inventory management, you can find her eating her way through Auckland.

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