Gas is up over $4.50 a gallon, transportation costs are going through the roof, your employees are struggling to keep their homes and your customers are scrutinizing every cost on their invoices. I think it is safe to assume our economy is in trouble. This means your supply chain, which you have been neglecting, is crucial to your organizations success or its imminent failure. It is even more basic than that, "Your warehouse is about to make you or break you!"

I am not an economist but the signs look bleak for those organizations that have not addressed the issues related to the distribution of their product. In other words, "Their Warehouse Operations!" Your inability to provide the customer: what they want, when they want it, on a consistent basis, and at a reasonable price will affect the livelihood of your organization during this down cycle.

Woseley announced plans to close 75 locations and said their profit was down by 23 of your top-line sales. That means a $100 million company will have approximately $20 million of inventory on hand. And it cost you between 20 of its value to stock that product in your warehouse. Now answer this question, how accurate is your inventory, 70, 95 of the cost associated with distribution. How much turnover do you experience in your warehouse? Do you have a training program for new hires? How do you motivate your employees? 75 of employees said they are disengaged. Disengagement is costing American organizations over $300 billion annually and to prove it, 66% of your lost customers can be traced back to employee disengagement or indifference. Again which is more important, "Your People or Your Inventory?"

Let me answer that question for you, "YOUR PEOPLE!" Your people are more important, because they control your inventory and communicate with your customers. With that being said, what will you do differently to service your customers, internal and external, during this economic downturn? Will you begin to: evaluate your slow and dead moving inventory to free up much needed warehouse space? Will you evaluate your stocking methodology to create a more efficient picking and putaway process? Or will you bury your head in the sand and hope it all blows over? I hate to admit it, but that is what most organizations are doing. In this economy, they do not have the capital to invest in improving their warehouse or supply chain operations. But when business was good, they did not have the resources or the time. So when do you do it? Your organization will suffer because you did not want to hear you had an ugly baby, or an inefficient warehouse. And it will suffer even more because you will bury you head in the sand and do nothing about it.

Your plan cannot simply be to lay people off. The reason that cannot be your only strategy is because you will layoff warehouse personnel but we have already established your warehouse is in shambles. How will you improve it with fewer people? You Won't!

Page 1 of 2 :: First | Last :: Prev | 1 2 | Next