Getting back to the rising importance of supply chain management, given the ongoing pockets of global shortages here and there, along with seemingly rising prices as a result. This posting in yahoo! finance reminds us (in a general way) of the shared focus on risk management inherent to the healthy relationship between buyers and suppliers.
The piece was penned by staff at BlueGrace Logistics, a Florida-based firm that has been around since 2007 and provides transportation management services and technology.
‘Logistics is an inherently risky business. The market is constantly changing, and business is affected by everything from natural disasters to shifting consumer demand. Choosing the right supply chain providers becomes an important part of mitigating and navigating these risks in an industry this volatile….While the dynamics of supply chain risk are constant, the landscape of risk specific to logistics and transportation is changing.Technology has affected the way everyone does business, offering companies new ways to manage risk. Still, the introduction of higher-tech solutions and other innovations does not eliminate the need for solid relationships. If anything, it emphasizes the need even more….”Technology is involved in everything. You still need to have a plan in place to address risk, and you still need people equipped to execute the plan,” said JD Lewis, BlueGrace Logistics Director of Supply Chain Solutions. “Having a clear, risk-sharing plan in place with providers benefits both companies and allows you to execute quickly when necessary.”‘
While these points are undoubtedly true, the posting could benefit from a case summary or some basic example(s) of the types of risk-managed and what solutions are available through BlueGrace or in general in this industry vertical. Readers who have an interest in the space (or the company specifically) can do further research or click on the website link within the posting, where various case studies are available. We typically cover things more related to transactions and the financing opportunities along the supply chain journey, but it’s good to have a broader view of how things operate to keep economies moving.
‘The strongest relationships are not immune to challenges, which makes open communication critically important. Plans and agreements provide a solid basis to operate, but business changes and market shifts inevitably require those arrangements be revisited from time to time. For example, a plan that seemed reasonable in December 2019 likely did not hold up completely as the world grappled with the coronavirus pandemic in April 2020….Even the best-laid plans cannot address every future possibility. Strong relationships rooted in mutual understanding and clear expectations provide structure when renegotiations are necessary….”When looking for an ideal provider, you have to define the most important priorities and understand you may not get it all,” Lewis said. “Have clear expectations of each other, and don’t rush in without knowing what those expectations are.” ‘
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group