Top Five Supply Chain Management Tips for Manufacturers

Manufacturing contributes a considerable amount to the economy in MENA, making up almost 9% of the MENA GDP in 20191.

It is a global industry and as many manufacturers will know, the supply chain process can be lengthy, complicated, requires an advanced logistical support system and brings other challenges too.

When dealing with multiple suppliers, your supply chain becomes more complex and it is important to protect yourself and your business, with the right approach.

Vet your suppliers thoroughly 

You can never do too much due diligence! Ensure current and new suppliers are thoroughly looked into. Research their reputation in the marketplace, ask for references and look into their other business partnerships as well as their financial stability. Choose organisations with a strong, sustainable proposition which won’t cause potential business disruption or brand conflicts with other clients. While it can be tempting to only look into new suppliers, it’s sensible to carry out regular reviews and audits on existing ones as well to ensure business continuity and implement changes if need be.

Plan for the worst

Crisis planning is a vital part of business management, and while most of us never face the worst-case scenario, it can be invaluable to plan ahead around wider events and their potential impact on your business. The COVID-19 pandemic showed us that we can’t always know what’s around the corner although some broader events such as trade route disruptions or bad harvests can be planned for. But, if and when the worst does happen, despite all of your planning, there will be opportunities to learn for next time. 

Use several suppliers

It can make for a more complex chain, but using various suppliers can be a much safer way to operate than using one or two large ones. That way, if one of them does run into difficulties, you are not left floundering. Always have a plan B and possibly a plan C too. Make sure you can quickly replace a supplier if required, especially for critical items impacting the whole supply chain and operations. This also applies to logistics, too. It’s sensible to have several routes and transport options if you run into a problem with your usual approach, covering raw materials and final product. Where possible keep a close eye on stock levels so that you are never left below certain pre-determined thresholds. The aim is to be able to keep running smoothly, regardless of hiccups caused by problematic situations, aim to become more resilient.

Invest in tech!

Current and technologies of the future should create enablers to ensure efficient and resilience supply chains. With so much technology at our fingertips, businesses of all sizes can look at and respond to everything in real-time through tracking and notification systems. Sophisticated data storage complements this ability and can often enable you to predict and respond to any issues before they even arise. Therefore, investing in supply management systems is a must. Enterprise Resource Planning tools can include modules for e-commerce, manufacturing, purchasing, sales, inventory and accounting. There are also specific software options that track the factory floor and assembly line production. 

Protect yourself

All the planning in the world cannot fully prepare you for the unexpected, and this is where the right insurance can help. A number of covers are at your disposal depending on your risks, including:

  • Implementing robust supply chain resilience and business continuity measures
  • Implementing dynamic incident response and crisis management plans including media response planning
  • Contingent business interruption insurance for physical damage caused by insured peril at a supplier or customer premises.
  • Trade credit and/or product quality and product recall for the failure of service provision by a supplier, including supplier insolvency.
  • Cyber liability insurance, which will help protect you should data be lost or stolen. 

These are a few of the options open to manufacturers when considering your insurance needs. Speaking to a knowledgeable risk advisory and broker will allow you to discuss your requirements in greater depth.

Supply chain management is all about spinning many plates. The priority for you is to protect your business and its bottom line so that you remain resilient and agile for the years ahead.


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Talal Darras

Senior Vice President, Strategic Risk Consulting