At the initial glance, single sourcing seems like a great idea. It boosts the relationship with the supplier, and you become more reliant, offering more benefits, managing the trouble, and better resolution of disputes. The long-term ideas might seem like the right idea.
But the thing is, it also comes with a lot of risk. Due to the pandemic and the like, supply chains throughout the world are still feeling this, and this is felt all throughout the packaging sectors. The rise of delays and shutdowns have started to mess up the supply networks that are there, and it’s left a lot of buyers trying to figure out the right way to continue the supply. The impact is also even bigger if you’re trying to use just a single source when you’re sourcing the packaging.
The risks that come with this are twofold. The first is initially when the supplier does go away for one reason or another, and then, you’ve got to figure out a new one, which is a huge challenge, leaving the networks in turmoil.
The second one is much less obvious. You also are not relying on the process as much. If the supplier does happen to disappear, you’ve got to set up another, and that's very hard.
It’s hard to set up, and if the specs and artwork don’t get documented, and aren't available freely, this is a problem. If you don’t have the files, that can take even longer. And when things shut down and travel gets very hard to do, it might soon become impossible to have people to ensure that the supplier and the specs are correct, even if the supplier is close nearby.
This can cause a lot of problems, including delays, which hurt the business. You need things to move fast, and delays are what will create chaos for those people who are trying to get products from you, and the interruptions and delays will frustrate your customers.
Building Flexibility
Using different supply chains and flexibility is really important. It prevents you from being caught with your pants down, and reduces the risk of just single sourcing in the event a problem happens.
When you build the supply chain, you want to ensure that you can switch the supplier the second something gets interrupted.
To do this, you need to first and foremost look for the key processes that are there, and identify them. are you relying too much on a singular supplier? Do you have a person that's looking at this, and someone who can check on it in the event that something happens and you can’t get to it.
The second thing is to simplify and put together the communications for the stakeholders there. bring all of this together into one conversation to ensure that everything is accurate and fast. You can replace the Excel files and email with different online tools for collaboration, especially for the information that’s critical, including artwork and the like.
Finally, you want to move this to a singular database that’s centralized, and have everything there, so that you can ensure that everything’s in place whenever you need this. try to automate all of your workflows to avoid the reliance on different informal types of arrangements, including monitoring these in real time, and from there, controlling the processes that are critical for all of this.
Building the proper system involves all of this, and when you single-source, it becomes a problem, so make sure that you don’t do this, and instead, spread it throughout different channels.
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