Why is Scalability Important in the Supply Chain?

Scalability is all about being able to change your business to cope with additional demands, whether this is permanent growth, or the peaks of the financial year, such as Christmas for many retailers. A major part of being scalable is within the supply chain, a hugely important component of business, and many would argue that nothing is more important when dealing with growth.

Supply chains can make or break businesses, and they can be difficult to get right, especially since there are many stages involved – it’s not simply logistics. Managers are constantly pursuing the best amount of balance possible; where everything is moving smoothly through the system, without excessive wait times or build-up of stock. If things take too long to get done, then deadlines can be missed, and customers and consumers may lose faith in your lack of movement and supply. Excessive amounts of stock can mean several things. Firstly, it is not good to have large amounts of your cash tied up in products, and secondly, it’s not cheap to store things; you’ll need additional warehouse space. There’s also the risk of products going out of date, whether perishable or simply obsolete.

Meeting the Challenge

Getting all of this right is undoubtedly difficult, and indeed, it becomes trickier when you’re positioning your operations in such a way that they can be quickly ramped up to meet additional demands.

So what can you do?

There are no hard and fast rules as to the best way of keeping things scalable, but perhaps one of the best is to simply let the experts take care of things. This is to say that it is often much easier to have contracts with specialist supply chain and logistics companies, and allow them to coordinate. They’ll generally be best placed to soak up additional demand without much issue, and if needs be, you can reduce things again. Logistics companies tend to operate large warehouses, and their business is centred on being able to cater for any size of client. Howard Tenens Logistics for instance, has more than three million square feet of warehouse space.

Getting your supply chain in top form is important for the day-to-day running of any business. You need to ensure that everything is moving where it should be, but if you’ve got an eye on growth, then it’s time to pay special interest in this business component, and ensuring it’s as lean and healthy as possible.