In this issue, we look at:
- The latest in global supply chain news
- Manufacturing tips from a safety gear founder
- 3 simple ways to cut inventory carrying costs
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In supply chain headlines
- New EU due diligence law altered to persuade Italy, Germany. After Rome and Berlin withdrew support for a recent law aimed at making companies liable for their suppliers' wrongdoings, the EU are attempting to draw them back in with a watered-down alternative of the original bill.
- UK and US retailers struggle with cautious consumers. A recent report found that retail firms around the world must deal with a significant dip in post-holiday sales this year, writes PYMNTS.
- US to award $6 billion in sustainable manufacturing grants. The Biden administration recently announced a new scheme to help cut metal and chemical emissions in heavy manufacturing, Bloomberg reports.
Mini-quiz: How well do you know Lean Manufacturing?
1. Which famous car manufacturers are said to be responsible for the origins of Lean Manufacturing?
a) Ford and Volkswagen AG
b) General Motors and Mercedes Benz
c) Toyota and Ford
d) Mercedes Benz and Toyota
2. What are the 7 types of waste in Lean Manufacturing?
a) Transport, Inventory, Motion, Waiting, Overproduction, Overprocessing, Defects.
b) Transport, Inventory, Overordering, Waiting, Overproduction, Overprocessing, Defects.
c) Transport, Inventory, Motion, Waiting, Overstocking, Overprocessing, Defects.
d) Sales, Inventory, Motion, Waiting, Overproduction, Overprocessing, Defects.
3. Which of the following is not one of the 5 core principles of Lean Manufacturing?
a) Map the value stream
b) Continuous improvement
c) Create flow
d) Supply chain resilience
(Scroll to the bottom of the page to reveal the solutions.)
- Learn more: Check out the Lean Manufacturing guide
Supplier tips from a safety gear founder – Meet Roman Zrazhevskiy
We recently chatted with Roman Zrazhevskiy, Founder and CEO of Mira Safety in Austin, Texas, to learn what life is like for manufacturers in 2024. Here’s what he had to say.
So, tell us a little bit about Mira Safety.
“We manufacture gas masks, filters, hazmat suits, and tactical gear for military, first responders, CBRN, and civil defence. Our products are designed to provide emergency preparedness, comfort, and superior protection under the harshest conditions.”
The last few years have been difficult for manufacturers – what have you found the most challenging lately?
“The toughest challenges we've faced recently are supplier reliability issues. Navigating through global supply chain disruptions has affected our ability to meet customer demands efficiently. This has emphasized the importance of robust supply chain management in maintaining product availability and customer satisfaction.”
How did you overcome your supplier reliability issues?
“To combat [those challenges], we’ve diversified our supplier base. By engaging with multiple suppliers across different regions, we've not only reduced dependency on any single supplier but also improved our bargaining power and resilience against regional disruptions. This strategy has been key to ensuring a stable supply chain, even in the face of unexpected global challenges.”
Is there a business strategy you're especially proud of?
“Recently, we've implemented AI in our inventory management. This step has not only streamlined our inventory processes but also provided predictive insights into stock levels – significantly reducing waste and improving product availability. This has enabled us to be more agile and responsive to market changes, setting a new standard in our operational efficiency.”
Are there any books or podcasts you recommend for fellow supply chain professionals?
“For business advice and industry insights, I highly recommend The Innovator’s Dilemma by Clayton M. Christensen. This book offers profound insights into how companies can disrupt their own processes and markets to stay ahead. It's been a cornerstone in shaping my approach to innovation – especially in a fast-paced industry like ours where staying ahead of technological advancements is crucial.”
3 simple ways to reduce your inventory carrying costs
- Update safety stock. Does your stock-holding strategy have a pandemic hangover? With global lead times currently dropping it’s worth picking your top few lines to check whether you can trim your buffers – after all, any reduction will free up cash. All you need to know is your current rate of demand and how long it takes stock to arrive once ordered. A simple safety stock calculator helps too.
- Evacuate your dead stock. 3PL fees a drag? It may be time to rid your warehouse of non-moving items to clear up space. Charities, discounts, product bundles are all effective ways to free up space on the shelves and trim inventory carrying costs.
- Think lean; cut waste. Lean methodologies aren’t just for manufacturers – they can be helpful for any business managing physical goods. Conduct an efficiency audit of your inventory management processes to identify opportunities for reducing waste – give special consideration to your purchasing strategy, unnecessary movements, and any manual tasks that could be automated with modern technologies.
Mini-quiz solutions
- c) Toyota and Ford
- a) Transport, Inventory, Motion, Waiting, Overproduction, Overprocessing, Defects.
- d) Supply chain resilience
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