Last on the list?

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A large number of manufacturers are simply not aware of the opportunities for efficiencies in their supply chains. The claim comes from a survey commissioned by DHL Supply Chain which found that just over half of companies expected to see a significant impact on profits from improving efficiency in the supply chain.

In fact, one respondent is quoted as saying: “Supplier management has been the key challenge for us. We agree in board meetings that we need to improve our supply chain, but unfortunately it is always last on the priority list.”

Yet, at the same time three quarters of those questioned said that an agile and responsive supply chain was key customer demand – and more than 70 per cent said their customers were looking for shorter lead times.

The research also showed that maintaining deliveries at the right time and in the right quantity was a key concern for customers, with 83 per cent of respondents stating that this is a key area for enhancement within the supply chain.

This survey was carried out by Benchmark Research for DHL Supply Chain and covered 120 management level supply chain employees. DHL’s Ian King points out that manufacturers recognise that there is room for further improvement in their supply chain, “but it seems that one area they might be overlooking is the impact that improving supply chain efficiency can have on their bottom line”.

It is understandable that when the market is growing strongly, the key imperative is to take advantage of the opportunity – even if it results in some increase in inefficiency in the supply chain.

But, for most companies growth is currently limited at best, and for some it is non-existent. In such circumstances, improving the efficiency of the supply chain should not be bottom of the list of boardroom priorities.

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