Supply chain outsourcing – A winning formula for business growth

Supply chains are very critical to the success of all the businesses. Optimizing supply chain results in the faster production cycles and reduced costs. Effective way to optimize supply chain is outsourcing SCM to the right experts.

Supply chain many activities including planning, sourcing and procurement and logistics management activities. This also includes coordination and collaboration with channel partners.

Apart from cost optimization, the key reason for outsourcing supply chain management is faster speed to market and end-to-end visibility. Outsourcing the supply chain management also helps to allow businesses to focus on their core competencies, meet customer demands more effectively and avail greater flexibility in maintaining and operating its supply chain. There are benefits of outsourcing supply chain management but there is a risk of integration as well that organisation might face when an external organisation manages the supply chain. If all the precautions were taken care of at the time of integration phase and the Supply Chain Partner has expertise and prior experience in managing the supply chain of other organisations than SCM can provide strategic, tactical, and transformational advantage to an organisation.

3 key aspects of any supply chain are Sourcing, Manufacturing and Logistics which further are categorized in Network design, Asset optimization, Technology integration, Daily execution & coordination, Supplier management and Exception management. Organization has to define the core competence and further decide on insourcing, outsourcing or hybrid strategy

In ‘Supply Chain and Logistics’ processes like warehousing, inventory management, order management, order fulfilment, shipping and return management etc are commonly outsourced. A leading 3PL player with automated processes framework and world-class technology is the best option to consider. A leading tech-enabled 3PL company helps in streamlining the entire supply chain by improvising business processes, bringing faster & new solutions, controlling operating costs, responding to shorter product cycles, and tackling competitors.

The benefits of outsourcing supply chain management are endless with the right supply chain company in India and the businesses with highly efficient supply chains enjoy greater than average revenues compared to others in their industries and thus better position themselves for business success. Reliable 3PL players take over the hassle of managing organisations’ supply chain network and allowing them to build better products/services, Develop new ideas, market and strengthen customer relationships, ideate and implement future growth strategies.

Right supply chain player provide access to their resources, skills, capabilities, technologies, business networks and thus allows businesses to focus on their long-term goal. Some of the benefits in outsourcing supply chain management are:

• Allows business to focus on the core business of manufacturing, supplying or delivering products.
• Organisations work along with experts that offer the latest supply chain technology, optimization, and customised solution to warehouse and network design projects.
• Outsourcing helps in reducing overall costs by lowering fulfilment logistics costs, including warehousing, fulfilment, and shipping cost using automated technology.
• Experienced 3PL players resolve demand fulfilment issues by offering specially designed algorithms by demand-driven planning and business-operating models based on real-time demand insights and demand shaping.
• Optimized inventory management helps organisations to reduce working capital (by reducing unnecessary inventory buffers) and improve their service level. It ensures satisfactory customers without holding too much inventory.
• Outsourcing reduces the financial risks of the investment in equipment, property, and transportation.
• Outsourced 3PL companies, gives access to their working resources and industry expertise and businesses can gain an edge over other larger players of their industry by leveraging it correctly.
• Working with 3PL supply chain partners will help business in achieving better visibility, security, and control into areas like compliance, quality, lead times and inventory levels and thus results in improved order accuracy and faster delivery.

Outsourcing supply chain management is a big step and the key is to choose the right partner amongst the supply chain companies in India. It is important to find a player that offers a consistent and reliable service across their entire distribution network. If organisations do not evaluate all the risks before finalising the supply chain partner, they might face the several issue including growth in inventory & customers’ orders, evolving consumer demands, logistics last-mile delivery problems and inefficient replenishment, among others. This makes it difficult for such businesses to focus on core functions, increase their customer base and market share and grow revenues. Therefore, it is mandatory for the organisations to evaluate and perform risk analysis on their outsourcing strategy.

Outsourcing supply chain management or choosing the right partner amongst the supply chain companies in India is a tedious task, but it is worth it in the long run. It is necessary to collaborate with a top supply chain companies in India that offers a global fulfilment network, best-in-class technology, and supply chain expertise.

TVS Supply Chain Solutions is one the top supply chain companies in India providing integrated supply chain solutions. For the last 15 years, TVS SCS has managed large and complex supply chains across multiple industries in India and selected global markets through customized tech-enabled solutions. Its wide warehousing network of 19.5 Mn Sq. Ft. space and ability to offer end-to-end transportation allows its customer to avoid capital investments on operations and concentrate on their core competencies.

TVS SCS provides specialized solutions to reduce complexity in customer’s supply chains by using technology, data analytics and execution experience to offer key solutions such as accurate demand forecasting, inventory planning and production, procurement management, network optimization, visibility, and supply chain agility to handle evolving needs. Its digital platforms are largely cloud based, powered by a micro service-based architecture and are highly scalable and reliable. The technology backbone and value added service portfolio enables TVS SCS as the key SCM Partner at the global level to be considered by the businesses while outsourcing their operations.