You're facing a material shortage in an emergency. How can you still save costs effectively?
Facing a material shortage, especially during emergencies, can be daunting. However, there are strategies to minimize the financial impact:
- Evaluate alternative suppliers or materials that could serve as temporary substitutes without significantly increasing costs.
- Streamline production processes to reduce waste and ensure the most efficient use of available materials.
- Negotiate payment terms with suppliers to defer costs without halting supply chains.
How have you managed cost-saving when faced with a material shortage? Share your experience.
You're facing a material shortage in an emergency. How can you still save costs effectively?
Facing a material shortage, especially during emergencies, can be daunting. However, there are strategies to minimize the financial impact:
- Evaluate alternative suppliers or materials that could serve as temporary substitutes without significantly increasing costs.
- Streamline production processes to reduce waste and ensure the most efficient use of available materials.
- Negotiate payment terms with suppliers to defer costs without halting supply chains.
How have you managed cost-saving when faced with a material shortage? Share your experience.
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The suggested actions in the header commentary are perfect. During a shortage event, everyone needs to be aligned that you will not service 100% of your customers and potentially your costs might spike given contractual obligations. Start with transparency with your customers and then "work the plan" on immediate needs. You just might find the supply chain has more inventory floating around and you have a "passing gear" for service. During an emergency your vendor will be overwhelmed with requests for quantities and delivery dates, you can't expect to get everything when you need it. Find substitutes as quickly as possible, leverage relationships and look for opportunities to produce what's needed as best you can. Collaborative!
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I can provide you a PP presentation used in 2010 for a situation at where material was needed to hold a Continuous Improvement event Kaizen Event for top 100 company. MTO part with 11 days L/T provided in just 4.
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