Companies need to act fast to take advantage of the opportunities offered by the recession as business confidence begins to return, according to logistics consultancy, Davies & Robson.
Davies & Robson chairman Brian Templar said as the UK economy begins to grow, the window of opportunity in which companies can create significant competitive advantage from the current situation could be over in a matter of months.
“Property is now readily available and lease terms are considerably more flexible and asset prices are low, although this is likely to change if sterling remains weak.
“Services are also more competitively priced and suppliers are more willing to accept more flexible pricing terms. Perhaps most importantly, good people are freely available.”
Templar added: “While this is understandable to some extent, the reality is that it is now that the fate of many companies is being decided. Severe recessions are a sure way of challenging the status quo, as the quick and nimble prepare to take advantage of the upturn, outmanoeuvring the slow and over cautious.
“Those companies that act quickly will gain competitive advantage because, although the recovery will take time, the real window of opportunity could well be over in a matter of months.”
The company said in supply chain terms, this means:
* Taking the time to ensure the required infrastructure is suited to realistic levels of planned activity
* Addressing inefficiencies that were not a priority when high levels of economic activity covered underlying problems
* Acting quickly to restructure property requirements in order to take advantage of favourable terms
* Reviewing third party logistics contracts to ensure they meet future needs. This includes not only benchmarking service and cost, but also the viability of contractors and looking for opportunities to introduce variable costing
*Ensuring that when the upturn comes, necessary changes to the supply chain are already in place.
“Companies need to plan now for how they want to emerge from the recession. The success stories of the next five years will be those that are able to take advantage of the new reality and make the necessary changes despite the current uncertainty,” concludes Templar.
