If you’re going to beat supply chain demand when the economy is tough, it’s important to remain proactive in business so you can continue to gauge the clients’ interest during the unforeseeable future.
As you build your cash flow and supply chain network, to steadily upgrade your products and services during the good times, you’ll be able to strengthen the confidence and commitment of your most loyal customers even when times are bad.
Below are 10 steps Fast Company Executive Board members have taken to deal with the current inflation and supply chain crisis.
1. PAY ATTENTION TO THE FORECAST.
We are very focused on forecasting and accurately determining future demand for our product. This information is then used to calculate our order of raw materials further in advance and also takes into account shipping delays. – Kelley Higney, Bug Bite Thing
2. FOCUS ON TALENT RECRUITMENT AND RETENTION.
Coming from the design consultancy, we have not been directly affected by supply chain crises and material challenges like product-based industries. However, the availability of a skilled workforce was a domino effect that created the “Great Resignation,” “Big Quit,” and the “Great Reshuffle,” which has impacted us. As a result, talent acquisition and the ability to maintain the top talent took priority in our ongoing strategy. – Goran Paun, ArtVersion
3. STAY CONNECTED (AND TRANSPARENT) WITH YOUR SUPPLIERS.
The decline in demand experienced by tech providers, followed by a sooner-than-expected recovery, strained the ability to respond to changes in buying behaviors. Surviving the supply chain disruption means ensuring a steady flow of materials. We have complete visibility across our supply chain, stay in contact with suppliers, and can support them. We invest in them to make sure they invest in us. – Matthew Tengwall, Verint Systems
4. STOCKPILE CASH FOR A VOLATILE MARKET.
Our strategies remain consistent so we can maintain the business. We create more value, increase our prices, focus on our best customers, increase sales, and then shorten the sales cycles. We strive to find alternative solutions to anything and everything, so it’s important to stockpile cash. The market is always going to be volatile. Another crisis is just around the corner. This isn’t new, nor is it a surprise. – Mike Koenigs, The Superpower Accelerator
5. INCORPORATE DIGITAL ASSETS.
Our team has always been incorporating digital assets into our programming. Now, more than ever, we are creating access by providing an additional digital iteration of our physical products. Digital isn’t always better, but it’s crucial to intentionally provide that option, especially in case of an unpredictable scenario like the one we are facing. – Liza Streiff, Knopman Marks Financial Training
6. UPGRADE YOUR SERVICES.
Apart from passing on price hikes to end consumers with little added value, we try to increase the service level offered with concurrent price hikes. While this increases the cost, it also helps to send the message that we’re trying to add additional value above just a simple price increase. We have found this to be incredibly effective, especially when it is properly communicated to customers. – Tyrone Foster, InvestNet, LLC
7. IMPLEMENT AN INFLATION ADJUSTMENT CLAUSE.
Our contracts have an Inflation Adjustment Clause as a default. This is a finance-related clause that should exist in your standard contract template which enables you, the supplier, the ability to adjust the fees associated with your existing contracts based on annual or periodic inflation rates published by the government. Most companies see this as reasonable, also adding timeframes for clarity. – Chad Engelgau, Acxiom
8. INVEST IN DATA THAT PREDICTS SHIPPING AND DELIVERY COSTS.
Lack of visibility into inventory across the supply chain is a costly problem. If you ship an item from the East Coast but the majority of your buyers are on the West Coast, you may be losing money. One way to overcome supply chain uncertainty is with data that predicts not only demand for a product, but the cost of shipping and delivery to ensure a company’s sales are profitable. – Eric Best, SoundCommerce
9. UPDATE NEW BUSINESS MODELS.
Resource diversification and knowledge sharing can help create resilient supply chains through waste valorization and local manufacturing. The recent advances in digital technologies are enabling companies to build new business models and accelerate the discovery and production cycles of highly efficient, alternative material, and energy systems, which unlocks sustainable and scalable solutions. – Gayatri Keskar, Material ConneXion
10. FIND WAYS TO REDUCE WASTE.
Be proactive. Speaking from personal experience, in the wake of the supply chain crisis, my team and I chose to reevaluate our orders in relation to the amount of waste produced from any given product. Working in coffee and foodservice means that waste is inevitable, but strategies can be put in place to reduce the amount of waste produced on a company-wide level. – Brandon Pena, BrandON Media Group