June 26, 2013
Suppliers are the squeezed middle of the supply chain, at one end facing demand for improved service from customers and at the other lacking the timely information from logistics service providers that prevent customers imposing punitive measures for delays or mistakes.
Forty-five consumer goods supply chain and logistics professionals who attended the Beyond the Visibility Gap Workshop in the UK last month were surveyed about their views on visibility.
For manufacturers and suppliers, visibility over the delivery-to-cash stage is crucial, firstly to satisfy the demands of the customer and secondly to recover full payment in the shortest possible time. Suppliers need to improve cash flow by ensuring variances, errors or claims are captured and resolved before payment is due.
Errors are introduced because technology gaps in supply chain communications are bridged by people who physically have to enter data or return documents to transport offices from the road. This impacts customer service (because staff often perform order entry, a back-office function), and accounts receivable and claims processing who need to investigate every instance rather than just the exceptions that can't be automated.
The survey highlighted increased demand for visibility with ninety percent of suppliers saying it was more important to their businesses in 2013 than in 2012. Ninety percent also witnessed increased demand from customers for timeliness and accuracy.
On the delivery side, only forty-three percent of logistics service providers (LSPs) were able to provide clean or unclean proof of delivery information to suppliers within twenty-four hours.
LSPs said information supplied from their sub-contractors became corrupted or diluted; with a mere seven percent able to provide accurate data to suppliers as a result.
A summary of the survey data can be downloaded from: