Continued Delays Impact More than Time
April 19, 2021
Delay after delay after delay. You have increasing demand, a slower supply chain and higher costs. You’ve ordered well in advance yet are not delivering on time due to reasons mostly outside your control. Ports were backed up well before the Suez Canal fiasco, and supply of containers is getting thinner and thinner. There aren’t many commercial flights coming to U.S. from overseas which typically carry goods also impacting cost of imported goods.
This is a real problem impacting everyone over the last 8-12 months. We’re paying more for worse service and it feels like there’s not much to do about it. No one wants price increases, a backorder or delays. Not you, your supplier or your customer; it is a loss for all. Though sales on paper are great, until they turn to cash they’re not really a sale at all, are they? Simply stated, delays are an opportunity you can’t fill immediately. How do we handle a delay with increased costs when we’re fixed on price?
From my experience in purchasing, it’s not as easy as it sounds. Every year, Europe closes for weeks in August, and it’s been this way as long as we’ve worked with European partners (50-plus years now). Yet, almost yearly, due to the August vacation, someone needs something we don’t have, and it’s a crushing feeling. Flexibility and creativity are two things you must have, and you must keep an open mind to find a solution.
Scheduling and carrying costs
Scheduling is one way around delays; the best professionals in the business forecast well in advance. Lean manufacturing is great and keeps operating costs down as low as they can be. But what costs more, lost opportunity or carrying costs of excess inventory? In a world where warehousing is one of the largest industries and 2-day shipping has become standard, the glass industry could benefit from faster turnaround. More than 4 to 8 weeks for product means your partner can go elsewhere.
As you know, it is harder to get someone back than to keep them, so why give them a chance to look elsewhere at all? As usual, I think positively and look for opportunity. A company adequately prepared takes market share from one that is not prepared. The real key in business is relevance; if you’re not where your customers are when they need you, then you won’t have the customer at all.
The West Coast model
The West Coast is extremely good at quick turnaround, and I love the model they use, taking an order up to 3 p.m., and making it ready for pickup by 8 a.m. the next day. They accept larger carrying costs to make sure they produce quickly. In uncertain times of delivery, like today, we must be willing to increase our carrying costs.
Instagram highlight: #galaxyglass_installations
Time for an Instagram shout out! #galaxyglass_installations have been cranking up over the last few months. Another multi-generational family business, founded in 1977. A fitting visual representation there are no one size fits all solutions, you must get creative and be able to adapt to the situation. Their page shows behind-the-scenes how their work is measured, created and installed. Be sure to check them out and give a follow.