How some Philly-area businesses are solving their supply chain crisis

Now that the economy is recovering, there’s a new crisis to confront: getting inventory to meet higher demand.

Most industries are facing supply chain challenges and the reasons go far beyond 2020′s pandemic. According to a 2021 study from logistics consulting firm GEP Worldwide, supply chains globally have not only been disrupted by the pandemic, but also impacted by other factors such as cyber-attacks, commodity prices, tougher environmental regulations, and trade disputes.

“The problem is massive and truly global,” says Brian Glick, the founder and owner of Chain.io, a Philadelphia-based supply chain technology provider. “Every region of the world is impacted, and large businesses are just as impacted as small ones. When a ship is sitting outside the port of Long Beach and can’t get in, you’re not getting your freight no matter who you are.”

Some companies are taking significant steps to address these issues — both for now and for the long term. What kind of steps?

So many of my clients are using this crisis to take full inventory counts, update their accounting systems, and institute regular “cycle” counts to make sure they are completely on top of what they have in the warehouse. Where possible, they are also increasing their “safety stocks” of inventories as a further cushion against shortages.

Emily Kohlhas, director of marketing at John Vena Produce in Philadelphia, said that supply chain challenges have caused her company to rethink parts of their product line.

“If product is going to have to sit for an extra 10 days at port, is it worthwhile to continue to stock it until the issues improve?” she said. “We’ve also had to start making our buying decisions much further out than normal to allow our growers to coordinate packing and transportation — which is exceptionally tough when we’re simultaneously dealing with highly unpredictable demand in the food-service sector.”

Keeping track of inventory is no longer a manual process, and the technologies for helping smaller companies get an immediate handle on their supply are readily available and coming down in price.

Software and hardware, such as Radio Frequency ID tags from Radiant and ClearStream, fleet GPS systems from Samsara and Garmin, bar coding hardware offered by various companies, and Ware drones and autonomous warehouse carriers from such companies as Fetch Robotics are simplifying getting the data needed to determine future purchasing needs and supply on hand to fulfill existing orders.

Many of my clients are also revisiting their inventory management software, such as that offered by Sage, Microsoft Dynamics, Epicor and Workday to fully leveragedata collection as well as artificially intelligent workflows to alert of shortages and order issues.

“The technology that is most in demand right are freight visibility solutions like Terminal49, Vizion API, and Ocean Insights,” Glick said. “Right now, most shippers can’t get any visibility to where their freight is, and these services are providing a window so companies can start making smarter decisions.”

“We took a list of our top customers,” said Mike Trapp, general manager of Griff Paper and Film, a manufacturer based in Fallsington, Bucks County. “We are reaching out to all of them and letting them know of our lead times. Our goal is to be completely transparent with them.”

Many of Griff’s customers understand the issues and are willing to work together to solve them. “That way, they’ve got the same information we have so that they can make whatever changes they need,” Trapp says. He has also met numerous times with his customer service team to make sure they’re on top of their largest customers and providingupdates.

Finally, companies are finding alternative sources and demanding more transparency from their suppliers.

Companies are also working closer with suppliers to better identify pain points and risks. They’re also asking hard questions.

“How much time does it take for them to respond to purchase order changes or expedite requests, assuming they even see them?” writes Tom Kieley, a supply chain executive. “How often are supply chain teams overpaying on supplier invoices that don’t match purchase orders?”

Kieley said that decision-makers should know the answers to these questions in real-time at the click of a button.

No matter how close a relationship one has with a supplier, it’s important to have a backup. No longer can companies lean on one vendor from China or a single source from India. They’re expanding their network of supply and joining supplier marketplaces like Thomas to find alternatives.

Gene Marks is a certified public accountant and the owner of the Marks Group, a technology and financial management consulting firm in Bala Cynwyd.