Don’t put all your eggs in one basket – the same goes for supply chain sourcing.
Sourcing commodities from a variety of locations and suppliers allows your company to mitigate the damage from disruptions and shortages since you have alternative means of procurement. It allows for a resilient flexibility against changing circumstances and the ability to ensure that your company can reliably get the supplies it needs to operate. In the words of the ancient Roman writer Publilius Syrus, “A plan that cannot be altered is a bad plan.”
The recent turbulence of the global supply chain has created a growing incentive for businesses to expand their network of suppliers with additional sourcing options. The 2021 BDO Manufacturing Survey found that 50% of manufacturers plan to expand their supply chain network by securing additional sourcing options, and that supply chain stability was reported to be the most critical factor in the recovery of the US manufacturing industry.
While the last few years have brought abnormal levels of economic and geopolitical volatility, there will always be disruptions to the global market and supply chain. A diverse supplier base with flexible sourcing options ensures the unhindered continuation of your business operations amidst the obstructions. Relying on a single supplier for key ingredients is a risky endeavor and a cause for concern.
Expanding your company’s supplier network also provides sustained profitable growth. Businesses can drive down net-costs by increasing competition on contract pricing between current suppliers and new potential ones. A report by The Hackett Group found that companies that pursued a long-term supplier diversification program generated a return on their investment 133% greater than firms that made no attempt to expand their supplier base. The report further claims that supplier diversity programs added $3.6 million to an organization’s bottom line for every $1 million spent on operation and procurement costs.
Built for the foodservice industry, ArrowStream’s Strategic Sourcing Solution provides end-to-end management for all your sourcing projects – all on a single platform. Find and identify new suppliers with ease and efficiency by utilizing ArrowStream’s network of over 9,500 foodservice suppliers – each with detailed supplier profiles on their products, services, and distribution. Get better prices on sourcing contracts using market data on cost, quality, and service to negotiate better prices; current customers save an average of 15-20% on contract spending. Save time in negotiation and sourcing contracts with a sourcing workflow tool that provides evaluative data on product, pricing, and distribution information; current customers experience a 15% average reduction in time required to complete RFPs, and a 4-15% reduction in the duration of sourcing events – allowing them to complete an average of 2 additional sourcing events per year.
ArrowStream provides all the most important information you need to manage and expand your supply chain – streamlined for priority all in one place. Diversify your supply chain with unparalleled market insights to ensure up-to-date price optimization and ready access to new suppliers. Speak with our team to learn more about how you can ensure the resilience of your company’s supply chain here.