Supply Chain Management | CHAS

Supply Chain Management

Health and Safety Management Services

Should You Outsource Your Supply Chain Management?

Managing a supply chain is no small task, which is why some companies look into outsourcing this aspect of their business. The question is: should you outsource your supply chain management, or do the risks outweight the benefits? In this article, we're going to take a look at some of the factors that will come into play as you make your decision.

Globalization has opened many new doors and complexities for businesses. To start, it has changed how manufacturers operate by allowing them to reach customers in previously closed markets. This means that competition is fiercer than ever, and in a bid to gain an edge, companies expanded the scope of their supply chain throughout the world. 

As the complexity of the supply chain increases so do the risks, which can arise from a large variety of causes, including operational errors, mismanagement and even natural disasters. However, companies can still maintain a considerable amount of control over their risk and mitigate it if the problems are internal. As soon as third parties become involved, that control diminishes.

The Benefits of Outsourcing
You could say that outsourcing becomes inevitable at a certain point. As the company grows, and its supply chain expands, more and more specialized knowledge and equipment is needed to handle daily tasks and procedures. For example, HVAC maintenance is something that facilities managers often outsource because it ends up being a profitable decision.

On top of that, liability becomes a more pressing issue as the size of the company increases. As the company starts to operate in other legislative areas, new regulations come into effect, and compliance can be expensive. In comes outsourcing as profitable solution, because the third party vendor will have to support the costs of compliance.

Challenges – Managing Risks
Implementing a proper risk management policy will require access to a large amount of data across multiple business systems. This can be a problem as your supply chain grows and your partners increase in numbers, because a lot of the data will simply by unavailable – it either goes uncollected, or the partner cannot release it. And, of course, you will face the classic challenges of questionable quality levels, integration difficulties, potential for delays in delivery, and unanticipated costs. 

Getting the Most Out of Outsourcing
Many of the challenges can be addressed if you manage to find the right partner. At CHAS, we focus on providing a vetting system that ensures third party vendors meet industry benchmarks, Health and Safety standards, and various quality assurance levels. When you choose one of our pre-vetted vendors, you can be sure that you minimize your risk of doing business, that your reputation stays pristine and that your supply chain is healthy. A lot of outsourcing headaches stem from the guesswork that goes into the initial hiring process, and it is our mission to ensure that you have access to the best vendors around.

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