Regardless of whether it’s mitigating the high costs of customer deliveries, reducing freight costs on incoming shipments, or merely reducing the costs on customer returns, all companies see reducing freight management costs as an essential part of improving profit. Some rely upon a strategy of using bulk shipments to drive down the per-unit freight costs on incoming shipments, while others try and use competitive bids to nail down the best possible deal. It’s a difficult pursuit and one made all the more difficult by a company’s manual processes. It’s like trying to catch lightning in a bottle; success is measured by the ability to have everything align and have absolutely nothing go wrong. Unfortunately, rarely does this happen. If something can go wrong, it will. However, there are some solutions to skyrocketing gas prices and the going concern of fuel surcharges, and they include managing freight via enterprise mobility solutions. So, what are some of the ways that your enterprise can reduce freight costs via a mobile, handheld computer?
Posts Tagged ‘supply contracts’
How does your company give its salespeople their marching orders? Do these discussions take place before your salespeople leave on a business trip, while they’re visiting customers, or once they return from a long, hard trip? Well, most companies give salespeople their objectives at the beginning of the year. They may then tweak them during a given month or quarter, but for the most part, their objectives are well understood at the outset of a new year. The hope is that the sales team will be incentivized enough to identify and close on all opportunities. However, how do you track their performance while they’re in the field?
One of the surest ways to reduce your company’s inventory costs is to use a vendor managed inventory agreement. Success or failure with these agreements is dependent upon strong cohesion between your purchasing department and its vendor base. Delays are commonplace and manageable, but inaccurate information is much more costly and far more damaging. As such, many of today’s enterprises are upgrading their enterprise mobility network with rugged handheld computers, and they’re giving these computers to a purchasing department that must manage an ever-expanding vendor base.
The “Great Recession,” as it’s now called, has certainly hit every company pretty hard. Demand is down, fuel costs are up and uncertainty abounds. Supply chain professionals understand that today’s fuel surcharges are just part of the day-to-day hassles of managing incoming shipments. Higher freight impacts gross profit margins, and companies are often forced to absorb the losses. However, procurement professionals aren’t just burdened by higher freight; inventory financing is also steadily increasing, this despite today’s historically low interest rates. Unfortunately, if customers take too long to pay their invoices, then a company’s financing costs will increase, no matter how low interest rates are. So, with freight on the rise, and financing steadily increasing, what must your company do to reduce its inventory and supply chain costs?
There are a myriad of books, courses, and training tools aimed at helping salespeople win more business. Some focus on improving B2B (business to business) customer relationships, some focus on the shorter sales cycles present in B2C (business to consumer) sales, and yet others concentrate on more complex sales, ones typically associated with large contractual agreements. However, what is the ultimate indicator of the ability for a salesperson to close a sale? Is it their “gift of gab”, their ability to turn a “no” into a “yes,” or is it simply their ability to get that customer the essential information they need to make an informed decision? Well, when you step back and take an honest look at sales, it becomes readily apparent that success often comes down to the ability to provide information in a timely manner. While not the only indicator of success, the ability of a salesperson to give accurate information does make a difference. With this in mind, a number of companies are helping their salespeople close more business via their rugged handheld computers. Salespersons today must be connected and mobile! They must be able to provide customers with immediate information, and it is this ability that often means the difference between business won and lost. So what are some of the immediate benefits of empowering your sales team with rugged mobile computers?
Can an argument be made that your customers are the greatest assets your company has? In order to answer this question, think of what a customer means to your business. First, customers provide your company with profit. Second, they justify the purchase of inventory and investment in additional warehousing space. Third, they provide a means to grow market share and further increase revenue. Fourth, they are the reason your company finances its future expansion. Fifth, they are the impetus you need to improve your product and service offering. This list could go on and on. The point is that everything begins and ends with your customers. Consider this a constant feedback loop. Happy customers buy more, which in turn increases your revenue, and allows you to grow your business. This is the reason your customers are your greatest asset and it is ultimately why your sales, marketing, customer service, and field service technicians, must have rugged mobile devices. It is these devices that allow them to better manage these customer assets.
The right supply contract can effectively reduce your carrying costs, improve your vendor relationships and improve your company’s market position. Most Companies don’t take the time to define what their inventory carrying really are. Are you aware of what’s included in these carrying costs and how they impact your bottom line? More importantly, do you use supply agreements with vendors to reduce the impact of theses costs, shorten turn times on material and improve your own product to market lead times? Perhaps you’re unaware of how these contracts work and their ability to streamline your supply chain. If that’s the case, don’t despair! Continue reading “Carrying Costs Reductions with Supply Contracts” »