When they work, supply chains are like magic. The organization works like clockwork, things get done well and on time, and most importantly, customers are happy! But when supply chains falter, a business can quickly descend into chaos and running it can turn into a nightmare. We saw an extreme version of this in the first half of 2020 and learnings from this period should inform how we build our businesses back strong in the future.
So, what should (or can) a small business owner do to avoid the fall out of supply chain disruptions? Here are some well-tested steps recommended by the experts –
- Create an emergency supply chain plan
- Stock up a massive bulk of inventory
- Identify back up suppliers and diversify your supply base
- Go local, if possible
- Put in robust supply chain and overall security measures
- Build partnerships with reputed logistics partners
Putting in place all these processes and planning for eventualities,of course,comes with an attached invoice. You might not need to spend too much to conduct an audit, identify gaps, and build a back-up plan, but the rest of it will require upfront cash to put into action.
This is where most small businesses drop the ball! And it hurts them twice as much as larger concerns! They are the ones least likely to have the cash reserves to weather disruptions, as well as being the ones with minimal protection and contingency plans.
Easy cash advances by alternative lenders can help in both scenarios –
To be better prepared
SME owners don’t have to put off strengthening supply chains due to lack of liquidity. With easily repaid cash advances, they can invest at their own pace to bring in the various measures mentioned above.
They can test and replace vendors, diversify to reduce risk and dependencies and work with good logistics partners who can help them in the long run.
Reduce impact in case of disruption
Cash advances can also come in very handy if things get rocky. Supply chain disruptions can have a serious impact on the cash flow and using alternative financing can help companies pivot quickly to newer business models, stockpile unsold inventory or plug the gap in cash-to-cash conversion cycles.
Access to money will keep SMEs afloat through the worse of it and help them restart when the situation improves.
If you have suffered supply chain disruptions in the past, then you know how harmful they can be. With some judicious planning, you will be able to avoid experiencing them again. So, if you have a plan to bolster your existing operations sitting on the back burner, now is the time to put it into action. Get in touch with our team to unlock the funds to invest in keeping your business safe and growing.