Driven by fast-paced changes and intense price competition, the tech manufacturing and distribution (M&D) supply chain is unlike any other. Every business is looking for ways to cut costs and reduce inefficiencies, but most are missing out on opportunities—perhaps without even realizing it.
The industry continues to shift and evolve, which means that you have to stay ahead of the curve—and the competition—just to stay afloat. Here, we’ll look at three areas that every technology M&D company should focus on, along with how the right approach can help you achieve those elusive goals.
- Cost Reduction
Cost reduction has always been the primary goal of supply chain and logistics optimization. After all, it’s the bottom line that truly counts, and a closer look at your logistics can help you identify inefficiencies and locate new, previously hidden ways to shave off both soft and hard dollar costs in the warehouse.
But in the world of tech manufacturing and distribution, cost pressures can be especially high because of the relentless nature of the competition. New companies and startups are popping up all the time, but even more importantly, each iteration of a tech product tends to become less and less expensive—the result being that those who can’t match competitive prices will quickly fall behind.
- Increasing Visibility
Every business grapples with inventory problems, and one of the most significant challenges in logistics is the ongoing attempt to match inventory to needs—so that you have product available for quick delivery for your customers, without sitting on inventory that you’ll never move.
In tech manufacturing, however, the problem is compounded by the extremely fast-moving pace of the technology itself. What’s here today could be gone tomorrow, replaced by something faster, meaner, and less expensive.
“Accurate, timely visibility into inventory—both inside and outside of the enterprise—is an increasingly strategic differentiator for tech companies grappling to move products before they become discounted, marginalized or obsolete,” writes Luis Humberto Erana of MH&L News. “Being able to see across multiple levels of a supply chain, detect changing conditions early on, and respond to them, gives a company the power to react more quickly and even anticipate changes that could impact sales and profitability. This is the visibility holy grail, and few companies have achieved it.”
But as Erana alludes to, visibility alone won’t solve these issues. It must be coupled with tools like business intelligence (BI) and robust KPIs to have the impact that tech M&D businesses need.
- Transparency: More Than A Buzzword
Transparency is more than just a logistics and supply chain buzzword—it’s also a key element of the tech operation, and one that’s often missing. A lack of transparency most frequently takes the form of opaque pricing agreements, particularly with the major freight carriers, who worsen the problem by hiking their rates, year after year.
These carrier pricing agreements represent a significant opportunity for tech M&D companies to reduce their overall costs and improve the bottom line—but their opaque nature makes it impossible to tell whether you’re doing the best you can. And while you may believe your negotiations have been effective, it’s hard to know without some basis for comparison.
Fortunately, MCG has a solution—not just to one of these common tech manufacturing pain points, but to all of them. Our algorithms compare millions of transactions in our database to determine what you should be paying the major carriers, both reducing costs and improving transparency. Meanwhile, our business intelligence (BI) tools and transportation management system (TMS) will ensure you’re always on top of KPIs—and able to harness those critical insights to make smart, data-driven business decisions.
Ready to cut costs, improve transparency, and increase visibility in your supply chain all at once? Contact MCG today for a no-cost savings analysis!