Running a small business has never been easy, but the challenges of helping your business survive and thrive have perhaps never been greater than they are today. From a lingering global pandemic and worldwide lockdowns to an unprecedented international supply chain crisis, there are, indeed, difficult waters for small business owners to navigate.
Fortunately, it is very possible to bring your company successfully through a supply chain disaster. The key is to plan, prepare, and not panic.
Understanding the Supply Chain and Its Impacts
In essence, the supply chain is the fuel that keeps your company humming. It ensures that you always have the materials you need to maintain the flow of your operations. It helps you keep your company stocked with the essential items that not only go into your products or services but also make it possible for your employees to deliver to customers in a timely manner.
When there’s a disaster in the supply chain, you’re going to experience delays and even stoppages in your workflow due to the scarcity of essential materials. That can mean unfulfilled orders, missed shipping deadlines, surging prices, irate customers, and, in some cases, employee furloughs.
Communicate, Communicate, Communicate
When your business is experiencing a supply chain crisis, the first and most important thing you can do is communicate. Reach out early and often to anyone who is likely to be impacted by the disruption.
This should, at the very least, include clear, consistent, and comprehensive communication with your customers, employees, partners, and stakeholders. Transparency is essential if you are to preserve the trust and loyalty you have cultivated with your clients and your team.
Fortunately, robust communication doesn’t require an immense investment in time or resources, which means that you can devote the majority of your time to addressing the supply chain disruption itself. Social media is a terrific business tool for building a thriving channel of communication with your customers, staff, partners, and investors.
Along with text, it’s almost always a good idea to use graphics on social media when posting essential updates. This can help your audience better understand even the most complex data at a glance. This will likely result in fewer frantic emails and phone calls from anxious customers and stakeholders desperate for a status update.
Have a Backup Plan
One of the biggest obstacles small business owners face is a lack of resources. It can be difficult to keep your company well supplied in the best of circumstances, let alone when there’s been a disruption in the supply chain.
Nevertheless, in these uncertain times, it’s wise to always have a supply chain backup plan that will automatically activate if and when a disaster occurs. You should keep at your disposal a list of reliable alternative suppliers. Whenever possible, opt for local partners to minimize shipping distances when the supply chain isn’t functioning properly.
Having a backup plan ensures that you’re not left scrambling if trouble comes. You will know precisely whom to call and what to do to minimize the impact.
Build Up, Organize, and Manage Inventory
Resources are often scarce when it comes to running a small business. However, to protect your company from the risk of a supply chain disaster, it’s best practice to do all you can to build up your inventory.
Though it’s likely that you will have precious little warehouse space to spare when you’re operating a small business, a cogent inventory management system will help you optimize your use of warehouse space while building emergency inventory reserves.
For instance, by establishing a clear and consistent labeling and organizational strategy, it will be much easier to accurately and efficiently monitor inventory levels and track inventory use. Digital inventory trackers are a particularly effective tool for assessing inventory needs in real-time. This allows you to ensure compliance with storage and disposal requirements while avoiding unnecessary losses, such as the discarding of products that are still viable.
Real-time inventory management systems also make it easier to reorder items before retailers sell out, meaning that you will always have a small surplus on hand to keep your warehouse well-stocked, no matter what may occur in the supply chain.
The Takeaway
The ongoing supply chain crisis has hit the global economy hard. However, small businesses have been most profoundly affected. The good news, though, is that there are many things small business owners can do to lead their companies successfully through even the worst of supply chain disasters. The key is to communicate effectively with stakeholders, cultivate a strong backup plan, and optimize your inventory planning and management. In this way, small business owners can ensure that their customers, employees, and partners always enjoy abundance, even in an environment of scarcity.