The drive to streamline and “rationalise” the supply chain has been a mantra for business for decades. Why pay for widgets months, if not years before you need them? Not only do you have to pay for them way in advance, but you also need to pay for somewhere to store them. Why not just place an order with your supplier, who will deliver tomorrow?
It’s so obvious, it’s hard to understand why anyone would work in a different way.
But to paraphrase Taylor Swift “This is a new world. A new beginning. And things will change.”
The worldwide pandemic we are currently experiencing has brought into very sharp focus how reliant we are on being able to get what we want when we need it. That applies whether you are running a business or looking for loo roll at the local supermarket. There was no shortage of loo roll, just a supply chain that was too engrained to “JIT” to respond to a sudden change in demand.
Small businesses, in particular, succeed by being responsive and flexible. If their customer needs fluctuate or suddenly vary, they need to be able to react quickly. This becomes much harder when they, in turn, rely on their supply chain.
Over the next year or so, these supply chains will come under pressure from not only the fallout from the Covid-19 situation but also from that “B” word that we’ve almost forgotten about. Brexit, remember that? There are likely to be delays at borders and increased difficulty for the transport industry. Relying on materials, components and supplies being delivered “just in time” could be a bit of a gamble.
Technology might provide an answer of sorts, but not in the way you might be thinking. Companies that handle a lot of data have three “states” for that data; online, near-line and off-line. Things they need to access daily, are kept “online”. Things they need periodically are “near-line” and archived items are “off-line”.
How would it work if business adopted the same idea to their supply chain? Things they need daily are kept “on-line’. They are in stock, on-site and ready to be used as soon as they are required. That supply could be replenished from a “near-line” source, for example, a local central storage facility. The “near-line” items could be replenished from the supplier. This creates a buffer to allow for more flexibility in the supply chain allowing you to cope with a sudden increase in demand. it also gives your business a buffer if the Just-in-Time supply chain breaks down.
Self-storage facilities with containers are a perfect solution to “near-line” storage for business. They are local and often accessible 24 hours a day. You can drive straight up to your unit and load directly into your vehicle. They are also a lot more cost-effective than warehouse solutions and there is no long term commitment.
At the Space Program, we have the locations and the services businesses need. We can cater for national organisations that require a regional hub. We can accept deliveries and store your goods ready for collection by your staff. Equally, we can provide storage facilities for smaller independent businesses. They are more likely to need flexibility and may not want the commitment or costs of a long lease at a warehouse.
By providing that “buffer” we can put additional flexibility into the supply chain that ensures “just in time” doesn’t become “just run out”.