Reshoring Accelerated: U.S. Manufacturers Choose Domestic Suppliers

Reshoring Accelerated: U.S. Manufacturers Choose Domestic Suppliers

Reshoring Accelerated: U.S. Manufacturers Choose Domestic Suppliers To Create More Resilient Supply Chains

The coronavirus pandemic shocked the world with chaos and disruption to the global supply chain. As a result, nearly 69% of American manufacturing and industrial companies said in June 2020 that they plan to reshore manufacturing and sourcing to the United States. This is an increase from 54% in February, 2020.1

Traditionally, a global supply chain provides benefits that can make offshoring very attractive—from lower labor wages, to reduced manufacturing costs, to more profitable end products.

But in a post-pandemic world still feeling the impact of supply chain weaknesses with the power to halt the flow of business, the sustainability of offshoring, the process of moving business operations from a company’s home country to a new one, is questionable—at best.

The pandemic, combined with existing global trade tensions, created a world in which the way people and industries operate will forever be changed.

One of the most significant changes across global trade and the domestic supply chain is the shift toward reshoring.

Thomasnet data confirms that companies are seeking out suppliers in North America that will help them grow their supply chain’s resilience.

What’s Driving Reshoring Efforts?

Reshoring is the process of returning domestic product manufacturing and sourcing from a foreign country back to the United States. It gives manufacturers and industrial companies more control over the supply chain and enables them to mitigate the risk of future disruptions.

The COVID-19 pandemic is not the only disruption creating a sense of urgency for manufacturers to establish more localized suppliers.

For example, tariffs or trade restrictions that prevent companies from sourcing raw materials required for manufacturing processes, such as plastic injection molding, were already prompting efforts to optimize their supply chains before the pandemic.

In a recent Gartner survey of industry leaders, 55% said they plan to maximize their supply chain resiliency within 2-3 years. About 33% of those same respondents noted new intentions to move busines out of China and other countries.2

A more stable and resilient supply chain that includes domestic suppliers provides more reliable access to raw materials, real-time visibility to the product development process, and better insight to quickly identify potential threats to the flow of business.

According to March 2020’s Thomas Industrial Survey with 1,073 qualified industrial respondents, COVID-19 supply chain disruptions had resulted in a growing desire for locally sourced materials and services.3

 

Balancing Supplier Consolidation with Supplier Diversification

Watch the webinar to learn how these strategies work together to remove risk from your supply chain while leveraging it to benefit your business.

WATCH

“Made In The USA” Impacts Consumer Buying Trends, Drives Reshoring Efforts

Though the concept of reshoring is not new, the pandemic revealed critical weaknesses beyond those of previous global disasters. According to Rosemary Coates, Executive Director of The Reshoring Institute, this is because of the scale and duration of the pandemic.

“[The pandemic] awoke in manufacturers a newfound understanding of supply-chain risk. Cost continues to be a major concern, but companies are now also looking to lessen the chances of supply-chain disruptions caused by events thousands of miles away from their intended markets,” Coates says.

“Companies woke up to the realization that just-in-time stocking strategies, which minimize inventory in the pipeline, can lead to severe shortages of product at crucial times.”4

The Results Are In: Top 3 Consumer Trends That Support Reshoring

The Reshoring Institute recently conducted a survey across the United States to measure the impact “Made In The USA” would have on consumers. For example, nearly 70% of respondents said they would prefer buying American-made products.

Here are three trends reported by the Reshoring Institute’s survey that support consumer trends toward Made In The USA:

  • More than 83% of the same respondents said they would pay up to 20% more for products made domestically
  • Over 46% of respondents believe that products manufactured in America are better quality than those manufactured in other countries
  • Nearly 60% of respondents indicated the country of origin influenced their buying behavior

Download complete survey results: The Reshoring Institute Survey Results

If you are in the process of reshoring or building a domestic supply chain, consider adding Xcentric as an approved partner for rapid manufacturing. Contact one of our account executives to start a conversation.

Xcentric provides rapid manufacturing services including injection molding, rapid prototyping, CNC machining, and 3D printing.

Download Xcentric’s Service Sheets.

 

Working on a project?

Let us help you get that first prototype underway and have that part in your hands in as few as five days. Our engineers help you through the design process. Get your project started now!

For an Agile Supply Chain, Balance Your Supplier Base

For an Agile Supply Chain, Balance Your Supplier Base

To Build A More Agile Supply Chain, Balance Supplier Consolidation and Supplier Diversification

Building an agile supply chain anchored in the United States is more important than ever. Many manufacturers have been trying to reduce their reliance on China as the fragility of their supply chain networks has been exposed. Initally this was due to tariffs and then in 2020 the COVID-19 pandemic.

In addition, factory lockdowns, political unrest, and even natural disasters are driving procurement professionals to reconsider their supply chain strategy and secure partnerships closer to home. 

But even if your entire supply chain is in the US, optimizing your supplier base can still help mitigate risk.

In this blog we explain the advantages of balancing supplier consolidation and diversification and provide tips for implementing these strategies to help build a more agile supply chain.

Before jumping in to how to balance the two strategies, we’ll discuss the advantages of each one.

Balance strategies of consolidation and diversification to build a more agile supply chain.

Advantages Of Supplier Consolidation

Better Processes, Pricing, And Speed Time-to-Market

The Pareto Principle, or 80/20 rule, specifies that 80% of results come from 20% of the action. In many cases manufacturers that consolidate their spend into fewer suppliers generally have greater flexibility to leverage buying power.   

Streamline Process and Procedures

Supplier consolidation can improve the agility of your internal team in two ways. First, by reducing the number of contacts they work with. And second, reducing the number of processes they need to follow when requesting quotes.

Though often considered a “soft” cost, tasking purchasing and engineering to quote projects can be expensive.

This process often involves taking time to separate parts by category like fasteners, MRO/consumables, and then plastics, metals. It could also involve organizing by manufacturing process type like injection molding, CNC machining, or rapid prototyping.

For example, consider an upcoming project that requires three competitive quotes:

  •  Company A requires quotes be submitted through a portal system
  • Company B may require 2D drawings via email
  • Company C requires CAD files and 2D drawings but only through their website’s generic sales email box

With this example, it’s easy to see how consolidating your supplier base reduces the number of contacts and streamlines processes to make your organization more efficient.

Reduce “Soft” Admin Costs

Companies often overlook admin costs when setting their cost savings goals. Common tactics include asking suppliers for price breaks based on quaintites. Or rebate programs that align with annual spend.

Fewer suppliers can result in “soft” cost savings across departments.

For example, processing fewer purchase orders can save time and money. For instance, less data entry, emails, and time spent clarifying orders.

Speed Time-to-Market

Supplier consolidation can help speed time-to-market. Especially for companies that rely on their supply chain for full-service quality control of their parts.

Selecting a few trusted vendors can help control the process. Thereby reducing rejected parts, failures in the field, and complaints from end customers.

Fast 5 Action Items: Supplier Consolidation For a More Agile Supply Chain

To get started, identify specific goals that you want to achieve. Then evaluate your supplier base against these expectations to help choose the right fit.

Here are 5 action items to help guide you through the consolidation process.

Consider all costs 

Piece price is critical, as long as you don’t lose big in other areas. That’s why it’s important to consider all costs associated with adding or subtracting vendors from your supplier base.

  • Logistics – Is the vendor located near your company? Will the difference in freight cost exceed the perceived cost savings?
  • Process agility – Is production handled entirely in-house, or do they outsource secondary processes? How many touch points are required to complete the manufacturing process?
  • Speed-to-market – What is the vendor’s track record for turnaround time? Will you save money on piece price but lose market share due to slow turnaround time?

Data visibility

Software programs can slice and dice information a million ways. So analyzing your data in a meaningful way is critical for effective consolidation efforts.

Evaluate your current systems’ ability to track and measure the following.

  • Quality control and vendor performance
  • Key Performance Indicators including on-time delivery, communications, and feedback
  • Records – Data such as number of purchase orders placed weekly, monthly, annually for a particular part or group of parts to a particular vendor

Scale production for greater flexibility 

Partnering with suppliers who can quickly scale from prototyping runs to low volume or high-volume production can improve the agility of your supply chain.

  • What is the vendor’s product development process?
  • How quickly can they deliver prototypes?
  • How fast are they able to transition from prototype to production?

Transition to a digital ecosystem

A digital ecosystem uses technology to connect all areas of your business. For instance, internal teams, customers, vendors, and external organizations. Doing so improves data flow and helps drive your business.

Organize supplier data into categories

For example, for parts consider:

  • Material type
  • Overall spend
  • Secondary manufacturing processes

Advantages of Supplier Diversification

Drive Innovation, Identify New Revenue Streams, and Expand Market Share

Supplier diversification does more than improve resilience to disruptions. It can help maintain the competitive edge. This can be achieved by choosing suppliers with new areas of expertise as well as those owned by minorities.

Drive innovation

Diversifying your vendor network can introduce Subject Matter Experts (SMEs) outside of your usual channels. New SMEs provide access to different ideas, different experiences, and out-of-the-box thinking. And, leveraging their abilities can help you to advance your products and enter new markets.

Include diversity in your diversification strategy

Often, a diversification strategy will lead to partnerships with smaller companies that can quickly adapt to market changes.

Also, consider including minority-owned partners in your diversification strategy. Doing so can help you access growing minority markets.

A recent report from Michigan State University stated that “Diverse suppliers can be a cornerstone of any organization’s success, helping companies to ethically and efficiently source products and services while maintaining profits, growing customers, improving the economy and encouraging innovation. With forward-thinking supply chain management and a focus on strategic sourcing, companies and the diverse suppliers within their supply chains can increasingly benefit from going into business together.”

Fast 5 Action Items: Supplier Diversification

A diversification program does not have to be an all or nothing. Use these recommendations to help guide your selection process.

Identify supply chain risks to avoid

Start by identifying the specific supply chain risks you want to avoid. Then evaluate vendors to find the right ones for building a more resilient and agile supply chain.

  • Tariffs and lockdowns
  • Increased labor costs
  • Regional and global disruptions

Implement in stages

Keep in mind that diversification is more difficult with current projects in production. Taking an incremental approach will be more cost- and time-efficient.

Instead, apply the strategy to new projects. First, determine whether the vendors’ SMEs can assist with the transition. Then evaluate them for specific criteria including:

  • Do they have an onboarding process?
  • Can they get involved early?
  • How can they drive innovation from the beginning?

Evaluate SMEs

How can vendors’ SMEs drive innovation? One of the key benefits to diversifying your supplier base is to leverage new areas of expertise to gain access to new markets. Evaluate SMEs to ensure they can help you drive innovation.

  • Identify their core areas of expertise
  • What opportunities can they expose you to?
  • What is their process for penetrating new markets?

Diversity

Consider suppliers whose own diversity can support your company’s goals to improve your corporate diversity. At the same time, these suppliers can improve your competitiveness in changing market demographics.

  • What is their ownership status?
  • Ask for a list of organizations they work with
  • Identify opportunities they can help you achieve

Flexibility and agility

Look for suppliers that can quickly scale to meet changing market demands.

  • Company size – smaller suppliers are often more nimble.
  • Value-add – Look for suppliers that offer more than one service
  • Logistics – Can they complete all services in-house?

The Right Balance Can Help Build A More Resilient and Agile Supply Chain

Strategies of consolidation and diversification are not necessarily opposing. Rather, they can work together to optimize your supplier base. Before deciding how to proceed, determine your goals. Once you agree upon the objective, the strategies can be put in place.

Avoid analysis paralysis. Avoid analysis paralysis. Don’t tackle tens or hundreds of potential new suppliers. Instead, focus on new product programs and evaluate 3 or 4 new suppliers.

Remove legacy bias. Define a set of criteria which will benefit your business. Then evaluate both new and legacy suppliers against the same criteria.

Be hyper critical when adding or subtracting vendors. Legacy suppliers don’t necessarily need to be cut loose. And new suppliers won’t necessarily help improve your business. Be critical when creating your evaluation criteria with the goal of benefiting the business.

Remember, the goal is to find the right balance to build a resilient and agile supply chain. One that can help you maintain the competitive edge in any market condition.

Working on a project?

Let us help you get that first prototype underway and have that part in your hands in as few as five days. Our engineers help you through the design process. Get your project started now!

Diversify Network of Vendors| Mitigate Supply Chain Risk

Diversify Network of Vendors| Mitigate Supply Chain Risk

Are Legacy Vendors Invested In Your Success?
If Not, You Could Be Vulnerable to Risk.

As the technologies that drive manufacturing continue to advance, processes like rapid prototyping are becoming more mainstream and in demand.

To meet this demand, the vendor pool is increasing—and their platforms are evolving to make quoting projects faster and easier than ever.

This seems ideal for companies eager to bring products to market fast. Afterall, having more options to choose from can help you to secure the competitive edge.

But more isn’t better.

In fact, having too many vendors to choose from can lead to analysis paralysis—or “vendor paralysis,” which can introduce elements of risk to the supply chain, business, project, and even your ability to deliver on personal goals.

Of course, this may prompt you to rely more heavily on legacy vendors. But what if they shut down due to any number of business disruptions? How will they deliver your parts? Do they have measures in place to protect your supply in any market?

Solution: Build a diverse network of trusted vendors invested in your success.

To help mitigate risk throughout the product development process, and to your supply chain, build a diverse network of trusted partners based in the USA. A team that functions as an extension of your business with invested interest in helping you to succeed.

Too many options can result in “vendor paralysis.”

Vendor Paralysis and Legacy Vendors: Elements of Risk

A key solution for mitigating risk is to diversify your vendor network. However, this is difficult to accomplish when you have too many to choose from or rely too heavily on legacy vendors.

Vendor paralysis

Forbes defines analysis paralysis as the moments when someone is so overwhelmed with choices that they are unable to make a decision. Vendor paralysis can be defined in the same vein. That is, as the vendor pool continues to increase, the more difficult it becomes to choose one.

For example, indecisiveness will prevent projects from moving forward in the product development process. Which, as you can imagine, will lead to product launch delays, added costs, and missed market opportunity. Further, vendor paralysis can also result in an overreliance on legacy vendors.

3-quote Solution: Getting Quotes vs. Vetting Partners

So how can organizations solve for this indecisiveness? Based on conversations with engineers, purchasing, and sourcing, companies are requiring employees to get 3 competitive quotes for every job.

But getting 3 quotes is different than vetting 3 partners invested in your success.

Though implemented with good intentions, it is a transactional solution. One that does not require vetting a vendor’s capabilities, having conversations around them, ensuring they are accurate and meet the needs of the project.

Ultimately, instead of advancing toward a more diverse network of trusted partners, the 3-quote solution still results in relying too heavily on a select few vendors which can greatly increase risk.

Legacy Vendors

We appreciate the value of legacy relationships. They are safe, comfortable, and reliable. And when faced with aggressive deadlines to bring products to market, it can feel faster and easier to rely on what you know.

There’s no denying that the COVID-19 pandemic revealed painful weaknesses in our supply chains. And, after 2020, it’s a lot harder to say, “that could never happen.”

Unexpected Problems & What They Mean To Your Supply Chain

Now, more than ever, it’s clear that any type of disruption can introduce elements of risk to your business: tariffs, pandemics, hurricanes, tornadoes, earthquakes, wildfires, military uprisings, a death in the family, personal emergency, and human error.

The question, then, is how will your legacy vendors keep your business flowing if their business shuts down due events out of their control? Without a backup plan, how will you get your parts?

Now consider the bigger picture. If your legacy vendors cannot sustain your supply, it could result in missing the chance to bring products to market and failure to secure the competitive edge.

You could also lose your biggest customer who pays your bills, forcing you to lay off employees or close business altogether.

Diversify Your Network of Trusted Partners To Help Mitigate Risk

A diverse network of fully vetted partners can help to mitigate risk to the supply chain, keep a small business from closing, and reduce personal risk.

Further, a network of partners—truly invested in your success –  can save time and money, provide higher acceptance rate on parts, provide better transparency on timelines and updates, and enable you to re-establish relationships with previous customers due to better capabilities.

To achieve success, choose US-based suppliers, don’t rely on “what’s always been done” as a litmus test. Further, insist on communication and collaboration between your internal teams and vendors.

Choose 4 USA-based Vendors Per Manufacturing Process

Vetting domestic vendors for manufacturing processes such as injection molding and 3D printing will provide advantages such as shorter logistics and real-time visibility into their manufacturing process.

Building a network that includes 4 vendors for each manufacturing process will help mitigate risk by ensuring you have a backup if there is an unexpected event.

Further, diversifying your network to include partners with different production capabilities can help add flexibility.

Choose 4 domestic vendors for each manufacturing process.

Use a New Litmus Test To Vet Vendors

When vetting new vendors, resist the urge to rely on past experiences as a measure of success. One of the critical goals of this process is to diversify your network beyond your current relationships to help mitigate risk and stimulate innovation. Otherwise you will continue on the same path.

Communication & Collaboration Between Internal Teams and Vendors

Break Down Silos To Help Reduce Mistakes

Too often, hard work by many is derailed or overlooked because of one missing piece resulting in a variety of mistakes. Promoting communication and collaboration between vendors and your internal teams can increase transparency and reduce errors.

For instance, typically internal groups (engineers, product designers, purchasing, etc.) are siloed and miss critical communications. Thereby resulting in errors such as quantity requirements, turnaround time, and invoicing.

These mistakes can prevent you from getting the parts you need when you need them. And when teams work together, simple mistakes that could otherwise lead to larger ramifications can be eliminated.

Invest time in the Partnerships

Develop genuine relationships with vendors and stay plugged in with your partner representatives.

This helps to ensure you always know if something may prevent getting accurate parts on time.

Having up-to-date information at all times from your partners will help to proactively mitigate risk and adjust internal planning versus scrambling to fix a problem.

Conclusion

Vendor paralysis and relying too heavily on legacy vendor relationships can make you and your business vulnerable to risk.

Building a diverse network of trusted, domestic partners that are vetted for each manufacturing specialty can help to mitigate risk to the supply chain and maintain the flow of business in any market climate.

If you would like to discuss strategies for diversifying your vendor network, please contact Xcentric. We would love to be part of your success story. Contact our Application Engineers at sales@xcentricmold.com or 586-598-4636.

Working on a project?

Let us help you get that first prototype underway and have that part in your hands in as few as five days. Our engineers help you through the design process. Get your project started now!

Digital Manufacturing | Robust Supply Chain

Digital Manufacturing | Robust Supply Chain

Rapid Digital Manufacturing: Linking Plastic Injection Molding To The Global Supply Chain

Digital manufacturing is critical for achieving one of the post-pandemic goals: a robust and sustainable supply chain. One that can maintain the flow of business in any global climate.

This is because it links all areas of production. Digital manufacturing uses technologies like Artificial Intelligence (AI), the Internet of Things (IoT), and Machine Learning (ML) to connect services, supply chains, products, and processes.

In doing so, it provides greater visibility into the entire supply chain. And this level of insight helps companies to identify (and predict) potential kinks in the supply chain.

Essentially, smarter manufacturing.

And now, as we emerge from a global pandemic that exposed alarming weaknesses in the supply chain, we are finding new ways that digital manufacturing can enable a robust supply chain.

For example, choosing a rapid manufacturing partner that leverages digital manufacturing. Never thought about digital manufacturing and your manufacturing partners in the same sentence? Think again.

What is rapid manufacturing?

Rapid or digital manufacturing is a natural progression from traditional manufacturing. The capabilities afforded by digitization, automation and data connectivity translate into reduced costs, and increased efficiencies. These capabilities can even be used in injection molding.

So how does it work? Each process step is streamlined to accommodate quicker turnaround times with low-cost automated solutions.

Digital manufacturing process for plastic injection molding

The process is entirely digitized. First, request a custom injection molding quote and upload a 3D CAD file onto our servers. Next, part geometry and requirements are analyzed using our proprietary software. Then, an interactive quote is available online.

Upon approval an order is generated and the mold design is finalized within hours – together with the toolpath programming.

Using modular construction and standardized components, mold components are then machined, usually within a few days. After benching and mold finishing, the tool is assembled for first shots and inspection.

This process, achieved through rapid molding, will give your part a lead time of weeks instead of months. The average price? A fraction of the cost for traditional molding.

The capacity that’s available for you to get your part made? Your lead time is always the priority. It’s made in the USA with as many sourced mold materials and resins that can be procured in the allotted time.

As a result, digital manufacturing naturally accelerates every step of the process and reduces the labor intensity while driving the scale of your project.

Designing for injection molding?

 Learn how mold flow analysis can help to optimize the process before production begins.

Download

Digital manufacting: scale production to meet market demand

Post-COVID-19 we are faced with uncertainties in the market. Digital manufacturing enables us to scale production to help you meet market demand.

For example, consider a complex syringe. It may consist of three, distinct injection-molded parts. Before new production runs are needed to meet supply and demand, the product manager may have a revision to one of the components, driven by departmental standards.

In traditional manufacturing, the retooling investment may push the break- even manufacturing numbers into the thousands – a cost-prohibitive change for many smaller businesses. Digital manufacturing, in comparison, can implement that small design change for approximately a quarter of the investment in a quarter of the time.

Our unique ability to accommodate complex designs is our asset

Your designers have fewer roadblocks, freeing them to work on new projects instead of going back to the drawing board to modify their designs so they can be produced.

Rapid results let your team respond quickly to market requirements with the best product they can design – a competitive edge that keeps your company on top. Without design rework or months-long lead times, innovation can boost your company’s results.

Two optional digital manufacturing services: inspection and project management

The digital manufacturing process at Xcentric is a very rapid and seamless process. The key components of this process include cost, quality, automation and speed to market, which allows customers to go through the iteration process once or numerous times, if necessary, at a very quick speed. By following these steps, customers can maintain their existing quality controls, while developing good parts getting them to market faster.

There are two optional services in this process: inspection and project management.

Digital inspection allows for rapid feedback and tool modifications, if necessary. Experienced Tooling Engineers interface directly with designers during the entire process, providing expert advice and problem solving at any time, which is critical to ensure successful and fast product manufacturing.

In fact, shorter lead times from concept to development can create new-market discoveries. Previously untapped revenue streams that were potentially out of reach can be viable, thanks to new technologies, transforming how companies like yours do business.

Low-cost tooling, development and production have been streamlined so low-production runs are economical enough to test on select markets and use the feedback as an optimized learning curve.

Should demand rapidly increase, the rapid manufacturing process can transition between low-volume to mass production. In turn, that allows you to react to market behaviors quickly and easily, reduce your time to market for increased competitiveness and resolve any potential problems before they impact your shipments.

In instances where production inadvertently slows, rapid manufacturing allows you to make adjustments while still achieving the lowest total cost. That means regardless of the market’s volatility, rapid manufacturing lets you respond accordingly.

Digital manufacturing offers benefits across multiple touchpoints: reducing your time to market, labor overhead and asset utilization, giving you more opportunities for quality control and inventory management. These advantages allow you to explore new revenue streams, develop and enhance innovative designs and respond to market demands. The digital age can transform your company and give your designers the freedom they need to create, develop and enhance in one streamlined methodology. The future is here. Make it work for you.

 

Working on a project?

Let us help you get that first prototype underway and have that part in your hands in as few as five days. Our engineers help you through the design process. Get your project started now!

How To Build A Sustainable Supply Chain Post-COVID-19

How To Build A Sustainable Supply Chain Post-COVID-19

Supply Chain: More Sustainable and Agile After COVID-19

COVID-19 put a kink in the global supply chain. And it exposed weaknesses with the power to halt the flow of business. Now, as the world takes steps to define a new business-as-usual post-pandemic, manufacturers are rethinking their supply chain.

As a result, instead of relying on overseas suppliers, companies are exploring opportunities to create a more robust and sustainable supply chain closer to home. One with the flexibility to meet changing production needs, and the accessibility to do so with greater reliability.

Now, manufacturers must begin the process for establishing a more resilient supply chain that can endure the unexpected and continue to thrive during times of uncertainty.

To build such a supply chain, a manufacturer’s plan should include three essential components:

  1. Improve supply chain visibility
  2. Partner with suppliers that can quickly scale production
  3. Prepare an action plan for transforming to a more digital ecosystem

Gain Real-time Supply Chain Visibility 

Real-time visibility is one of the most sought-after ideals for optimizing the flow of goods and services. For one, it enables supply chain managers to track products from the source of raw materials to the final destination. Also, it empowers companies to seamlessly adapt to disruptions and serve customers with greater confidence.

For example, Forbes published a recent Oxford Economics survey of 1,000 supply chain executives. It found that 49% of Supply Chain Leaders can capture real-time data insights and act on them immediately. 51% use AI and predictive analytics to capture insights. This enables Supply Chain Leaders to react in real time to changing conditions. From widescale disruptions to individual customer complaints.[1]

Of course, achieving this degree of end-to-end visibility has always been a challenge—long before COVID-19. Now, faced with the reality of critical vulnerabilities brought to light by the pandemic, learning how to restructure relationships with suppliers will help companies to better understand the impact of disruptions and react accordingly.

Build A Transparent Supply Network: Top 3 Tactics 

Whether you opt to reshore or rely on overseas suppliers, approaching venders as part of a supply network rather than a chain can help to increase visibility. Networking will help to build collaborative, transparent relationships to facilitate proactive decision-making.

Therefore, to help increase visibility with your suppliers, consider these three tactics:

  1. Understand the pain points of your customers, internal teams, and suppliers.
    Prepare a process for gathering pain points that impact your customers, internal teams, and suppliers. For example, set a cadence for distributing a quarterly survey to establish an open line of communications. By understanding specific pain points, you can react quicker and more effectively to mitigate risk to your supply chain.
  2. Invest in technology and systems to optimize communications and provide easy access to critical assets.
    COVID-19 served as a catalyst for many businesses to rethink their supply chain and relationships with suppliers. For example, optimize methods for communicating critical assets and intel between suppliers, internal teams, and critical stakeholders. Invest in technology and systems to create greater transparency and make it easier to communicate essential information.
  3. Set Key Performance Indicators (KPIs) for success.
    Define terms and conditions of a successful vendor relationship. First, identify key suppliers. Then, set clear KPIs to enable real-time tracking of inventory, services, and production capabilities. Measure them on a regular basis. This will provide a more transparent view of suppliers’ flexibility to scale production as needed.

For more information about supply chain KPIs, visit Logistic Bureau’s blog, KPI Key Performance Indicators in Supply Chain & Logistics. You’ll learn best practices for setting KPIs, tips for implementing a hierarchy structure, and additional resources.

Partner With Suppliers That Can Quickly Scale Production

Headlines announcing crisis-level disruption to the heart of electronics manufacturing in China due to the Coronavirus surfaced on CNBC as early as February. Leaders in the industry explained that many consumer goods manufacturers in the U.S. could miss holiday deadlines. Because with factories closed in China, they could not manufacture prototypes, complete testing, or ramp up to full production. As a result, the pandemic created a great deal of market uncertainty that individuals and industries are still struggling to navigate.

For example, many consumers are already experiencing decreased disposable income. Which makes it difficult for consumer goods and electronics manufacturers to predict with confidence production volumes needed to meet the upcoming holiday season.

Design Challenges?

Need help optimizing your design for injection molding? Contact Xcentric’s consultants. We’re here to help!

Therefore, manufacturers must consider suppliers that can quickly scale production as market demands change.

Minimize costs with a flexible production model

Choose suppliers who can help minimize initial costs with an economical, flexible production model. This can help get back on schedule for the holiday season while minimizing the risk of uncertain demand. Look for suppliers who have the ability to quickly ramp up if demand surges and support lower volumes at price points that don’t damage profits if demand does not return to normal.

For example, consider Xcentric, a leading rapid manufacturer in the U.S. We provide first parts within a few short weeks and can quickly scale up to supply hundreds of thousands of parts per year. We can also bridge the gap to millions of parts per year to help mitigate risk.

Digitize Your Supply Network

Digitizing your supply chain and transitioning from a traditional, enterprise-focused operating model to a digital ecosystem is a major initiative. It will require substantial investment and restrucutring of your organization. We are including it, because the potential benefits to your supply chain merit sharing the information.

Managing a multi-tiered supply chain will always present a challenge. Still, in a world that runs on technology, preparing an action plan for creating a digital ecosystem and digitizing your supply network can help to build a more robust supply chain.

A traditional business operating system (BOS) functions at the enterprise level. It is a hardwired business model of processes and methods of communication. Alternatively, a network BOS is fully digital. Agile and flexible, it provides an optimized, fully accessible digital ecosystem.

Webinar Replay: Plastic Injection Molding Parts Clinic

Join Xcentric injection molding experts John Sidorowicz and Glen Miller to see common design mistakes and learn how to avoid them in your own part design.

What is a digital ecosystem?

A digital ecosystem uses technology to connect your supply chain. Suppliers, customers, stakeholders, internal teams, applications, third-party data providers, and digital assets. All connected via a network-based system to ensure your supply chain function in any global climate.

Digitizing your supply network helps to create a more resilient supply chain by:

  • Optimizing all members of the ecosystem with real-time visibility and flexibility to connect with all suppliers on the network
  • Providing a single point-of-contact and version of the truth; everyone connected has access to the same information

If you would like to learn more about digitizing your network, please visit Supply & Demand Chain Executive’s post, Intelligent Digital Ecosystems: How to Digitize Your Supply Network. The post does a great job explaining each component of a networked business operating system.

Conclusion and Key Points 

COVID-19 revealed a shockingly fragile global economy. And, it served as a catalyst for many businesses to rethink their supply chain. The unexpected disruption impacted businesses of all sizes in nearly every industry and country. In fact, Fortune reported that 94% of Fortune 1000 companies felt the disruption caused by the Coronavirus. [2] Conversely, the pandemic also showed us how quickly we can adapt to a virtual environment.

Go beyond COVID-19 with a more resilient supply chain. One that can sustain unexpected disruption and thrive in uncertainty. Consider implementing these tactics:

  • Increase real-time visibility into your supply chain. Take time to understand pain points of your customers, internal team, and suppliers
  • Set KPIs you can measure on a regular basis
  • Invest in technology to optimize communications and provide easy access to critical assets
  • Partner with suppliers that can quickly scale production. A flexible, agile supply chain will respond quickly to fluctuations in market demand
  • Digitize your supplier network. Create a digital ecosystem that connects customers, suppliers, and critical stakeholders

 

Working on a project?

Let us help you get that first prototype underway and have that part in your hands in as few as five days. Our engineers help you through the design process. Get your project started now!