With manufacturers under immense pressure to increase production capacity and output, industrial distributors’ phones are probably ringing off the hook. But I would imagine that demand is putting many distributors in uncomfortable predicaments.
With companies of all sizes vying for equipment and parts, competition for what little inventory is available is extremely fierce. Small and mid-size businesses (SMB) that were just starting to establish and nurture supplier relationships before the pandemic are going to feel like they’re fighting an uphill battle on the sourcing front. And all distributors are going to feel caught in the middle of their customers, forced to balance long-term commitments against current fulfillment capabilities.
So, what can small and mid-size distributors do to maintain operational continuity and retain customers’ trust in their ability to deliver?
In short, find a way to see more.
We have been inherently told that, when goods, services or labor are constrained, we must “learn how to do more with less.” But just like health advice evolves over time as we learn more about how the human body works, we must constantly reconsider whether old practices are still the best practices for our businesses. This is particularly true when our financial health and our customers’ well-being are at stake.
Sometimes, “doing more with less” just translates into busy work because you’re taking shots in the dark and seeing what sticks – especially if you’re flying blind. That’s why the best way for smaller distributors to make their size a moot point – or, if anything, an advantage – is to get the scoop on what’s really going on right now. Talk to people who are in the know, those on the ground at each supply chain touchpoint.
Once you know what’s happening within your operation, outside your four walls, and within the four walls of your suppliers and customers – not just what you hypothesize is happening – you can start to identify and even anticipate weak links in the supply chain. Of course, the more gaps or shortcomings you expose, the more problem solving will be required. But SMBs that dig in and commit to fortifying their supply chains will find it easier to overcome future adversity.
Downplay Disadvantages
Instead of feeling disadvantaged as a small or mid-size distributor because you have fewer tangible resources than your larger competitors, lean on the agility you have as a more nimble organization. You don’t have to go through all the red tape that larger companies do when you want to seek alternative sources, use new shipping channels, or reorganize the team to better balance the growing workload. You can just do it.
And though you may not have robots or other automation technologies employed yet in your distribution centers (DC), you do have dedicated, hard-working people who have been pulling off miracles for months on end – some of which were somehow performed using just pen and paper.
Can you imagine what more they could do if you simply digitized all your business data and digitalized a few key workflows, such as inventory management, receiving, picking, packing put away and shipping? I’m not talking about a complete digital transformation of your business. Just giving workers reliable, enterprise mobile computers that can alert them to truck arrivals, dwindling inventory or a new order that needs to get out the door today could be game changing. It could save them steps back and forth to a workstation every time they need to retrieve tasks, provide an update to a supervisor or customer, or print labels.
Plus, giving floor workers a mechanism to keep managers and customers apprised of progress in real time means your customer support teams will spend less time fielding inquiries. Managers can reassign those workers to higher priority tasks that will keep customers happy, such as helping to get orders out the door on time. Teams can also be rebalanced temporarily as orders and inventory surge to prevent anyone from falling behind.
Size Up Your Resources
Whether trying to address business or market growth, it’s important as an SMB to maximize the labor and technology tools already at your disposal.
If you have enough people but just need them to move faster to increase output capacity, the best first step is to give them rugged mobile computers or, depending on their role, barcode scanners, radio frequency identification (RFID readers) and mobile printers. This is the fundamental “digital” toolset in today’s distribution and warehousing environment. They can quickly locate, pick, and pack parts and equipment, report findings of visual quality inspections, and notify stakeholders when things are on the move to the next destination – whether that’s a shelf bin, packaging line, loading dock, or customer.
They can also conduct faster and more frequent inventory counts so you can stay 10 steps – and several days – ahead of complete stockouts. If on-time replenishment looks to be impossible based on your suppliers’ longer production lead times, then you can notify customers and work with them to find alternative solutions that still allow you and them to meet deadlines.
If your workers already have the basic technology toolset in hand, it might be time to free up their hands. Equipping pickers with wearable Bluetooth® scanners versus handheld scanners could be just what they need to grab items faster and move carts in a safer, more efficient manner. Attaching an RFID sled to a mobile computer can also give workers superpowers in the sense that they can read thousands of RFID tagged items within a certain proximity in a split second to instantly locate items or confirm on-hand quantities. They can also scan individual item barcodes when needed and report all data to the inventory management and warehouse management systems immediately. Depending on your software setup, this could be the beginning of automation within your DC. And automation is key to maintaining operational continuity and gaining a long-term competitive edge when labor is limited.
Upskill Your Workforce to Scale Up Productivity and Output
Once you have real-time data flowing in from across your business, it’s easier to size up your operation in terms of overall efficiency and capacity. You can gauge performance holistically then drill down into each department, workflow, and worker to see where opportunities exist to plug gaps or unclog bottlenecks. This process will also reveal people’s strengths and enable you to confirm you’re assigning each worker to the right team and shift. At the same time, it enables you to prescriptively assign tasks to certain people based on their current bandwidth, location and skillset.
With the right task management software running on mobile devices, it also becomes possible to cross-train people on the spot as you need to shift them around to fill gaps. They can get a play-by-play rundown of where to go next and what to do once there. This type of on-the-job training makes even the leanest of teams seem fully staffed, as workers gain versatile insights and skillsets that make them even more valuable contributors to your organization. Once exposed to new parts of the business, they may see things that others previously missed and help connect certain dots to solve problems and strengthen chain links.
See the Big Picture
At the end of the day, size doesn’t matter as much as flexibility, efficiency, and commitment. By equipping your team with the right technology tools and then scaling those tools accordingly, you are empowering them to exceed customers’ expectations, even when the chips are down. That, in turn, will give your manufacturing customers a tremendous advantage as they will have the components needed to scale their production and packaging operations and maximize growth opportunities. It’s a win-win scenario that will prove size is just a number, not a measure of one’s value, strength, or capabilities. This is especially in these challenging times when a distributor’s most valued skill may just be the ability to successfully troubleshoot issue after issue to keep manufacturers’ production lines – and the whole supply chain engine – running.
To learn more about the technologies that can help your small or mid-sized business gain a big-picture view of your growth opportunities and competitive advantages, click here.
Honig
