Many concerns confront the manufacturing business, including skilled labor scarcity, distribution network instability, and inventory control issues. Every challenge, however, presents an opportunity to adapt and progress.
Of course, all of these difficulties present opportunities for development and progress. If you are confident enough to overcome the obstacles, than certainly you will profit. Here are some of the problems you could face in the sector and what they entail for your supply chain and shipping procedures.
5 Supply Chain Challenges in Manufacturing
Pandemic-related Supply Chain Implications and Changes
Every industry has experienced ongoing changes and uncertainty since the commencement of the COVID-19 epidemic. Manufacturers, in particular, have been heavily hit. Demand fluctuated, making forecasting difficult. In addition to reducing unintentional accidents, employee safety procedures must now integrate COVID-19 protocols. Due to blocked borders, restricted air transport, and driver shortages, moving goods and materials was challenging, particularly at the pandemic's beginning.
It is still a difficulty for manufacturers two years after the pandemic began. However, one important lesson gained by manufacturers is the importance of contingency plans and adaptability. The capacity to be adaptable and alter your plan as necessary makes a company successful in an ever-changing landscape.
- Inventory management and supply chain management
In the manufacturing industry, inventory issues are widespread. Supply chain chaos is a major challenge today, particularly in logistics and supply chain management. Amid the chaos, it's tough for producers to stay structured and calm.
According to Deloitte's 2022 Manufacturing Industry Outlook., 41% of executives expect to expand or expand suppliers in existing markets to help balance this insecurity. In an attempt to limit outsourcing and streamline supply chains, companies are also localizing networks.
Inventory management software is a crucial tool. Manufacturers can employ real-time monitoring throughout the production process to maintain proper inventory levels. The tracking programme can track raw supplies, work-in-progress, and finished goods.
- Shortage of skilled workers
The shortage of skilled personnel is one of the most significant manufacturing concerns today. Despite a greater unemployment rate, finding the right talent in the United States has become 36% tougher than in 2018.
This problem has arisen due to the aging workforce and the expanding population. Manufacturers have a few options to consider to overcome this obstacle, including:
- Programs for transforming your less-skilled employees into more valued employees
- Ideas for communication and planning to keep some of your older, highly trained staff on the job past the expiration date; they otherwise might choose retirement.
- Collaborations with community colleges and other educational facilities can reduce the risk of entry-level hiring, boost worker productivity in the early months, and give tools for firms interested in apprenticeship programmes.
The skilled labor shortage also affects truck drivers, producing transportation problems. The American Trucking Association estimated that the trucking sector will be short 80,000 drivers by the end of 2021 and that if nothing is done, the shortage will quadruple by 2030. Rate fluctuations and capacity concerns are a result of this persistent problem.
- Adopting New Technologies
Technology advancements will go a long way toward assisting manufacturers in dealing with difficulties such as rising consumer demand and a skilled labor shortage. Making the necessary changes to integrate new technologies can be difficult. However, this can help to reduce inefficiencies in warehousing and inventory control, as well as logistics.
They must do so to remain relevant, creative, and competitive. One technological difficulty is figuring out how to use the Internet of Things (IoT) to fulfill operational goals, including cost reduction, efficiency, safety, compliance, and product innovation. It isn't enough to simply integrate technology into business products and services; a strategy is required.
In addition, logistical technology has progressed significantly. It is vital to invest in a complete transportation management system. You may get control of your shipping charges and operations by using tracking features and real-time freight analytics. Many of the difficulties we've mentioned can be solved with technology, but putting it into practice is a difficulty in and of itself.
- Transportation Costs Reduction
Transportation costs have risen due to growing demand, workforce shortages, rising fuel prices, and total supply chain unpredictability. Many supply chain professionals, particularly those in production, are looking to cut transportation expenses.
Partnering with a third-party logistics company will assist you in lowering your extra shipping costs.
How can a Logistics partner help?
Despite these obstacles, manufacturing remains vital to the American economy. Fortunately, the industry has several new technologies and solutions to reduce these difficulties. The manufacturing industry's main task will be to act. As a leading manufacturer, one must seize the opportunity for innovation that comes with big obstacles.
Visit us to find solutions for all your issues if you want to combat difficulties further and find wiser answers.