• Renier Bester

Lockdown Recovery - have a plan

‘Lockdown’. What emotion does the word trigger in you? Fear? Doubt? Anxiety? For some, all it means is no buying alcohol, no walking the dog and endless Uno games around the dining room table. For others, like you, there are bigger fish to fry. 

How to manage your cash flow. What will happen to your sales? How to deal with overstocked warehouses, needy staff and hungry creditors at your door. Is there a magical marketing campaign that can replenish lost income during this time? 

At Supply Chain Partner, we don’t focus on the problem. We like solutions. With our expertise entrenched in supply chain solutions, we’ve put together a five-point Lockdown Recovery Plan to get you through the next 21 days and beyond.

Our approach is not new; it’s not just a vision, process or a methodology. It’s is a business model that highlights two values:

· the soundness of taking a holistic, integrated view in making business decisions for a company

· and the power of relationships.

1. Appoint cross-functional teams

To obtain the holistic, integrated view required, it’s important that opinions are sourced from all areas of your business: warehousing, inventory, engineering, production and sales. Teams should be formed remotely with members representing a range of ages, disciplines and seniority. 

2. Allocate spend reviews 

The first task for the teams is to analyse and review purchases from your company’s last financial year. Typically, this involves a download of every line item of purchase for the year. This can be a tedious exercise, but it’s worthwhile. The process can only kick off once the analysis is complete. Without a robust understanding of your purchase history, the solutions are not comprehensive enough.

Identifying savings opportunities accurately and quickly is largely dependent on the quality of the spend data you have. As a guideline, some of the quicker opportunities are normally procurement process related as opposed to the larger, more complex analytics into the commodities procured and benchmarking of prices and negotiated terms. Some examples of process opportunities might be non-usage of already negotiated contracts, regular late payments of invoices with settlement discounts attached and duplicate supplier payments.

Lastly, spend time to ensure that you have the required data from the onset of performing the analysis. Incomplete data may severely impact the efficiency of your spend analysis and will usually become apparent after performing a large portion of the analysis. By amending data and reworking analytic results, you’ll considerably increase the time invested and decrease the risk of a loss of integrity in the result of the analysis.

3. Explore ‘out-of-the-box’ savings ideas

Explore categories that show promise. Categories can be allocated to different teams so that ideas for savings can be investigated and then rotated to another team for review. These ideas can be innovative, practical, or even downright silly. Nothing is off the table. You have a business to run/save. Identify savings that fall into your short-term plans, without excluding long-term initiatives. Outcomes can be defined and shortlisted into re-engineering, innovation, negotiation and process revamps. It’s important to remember that, in most cases, the opportunities that you are able to realise the quickest are the ones in your control. Savings do not have to come from supplier negotiations only. Organisations often underestimate the number of opportunities to be pursued that involves improving the way things are done internally. It’s for this reason that the cross-functional teams are so important in times like these as they include people involved in daily operations. These resources are invaluable in highlighting related opportunities for savings and improved efficiency.

In a recent spend management article from Mckinsey, they advise business owners to “set up a ‘cash control tower’, with representation from both the procurement and sales teams, to examine spend and identify potential reductions in cash outflow.”

4. Manage suppliers

That being said, there is no discounting the fact that a large number of savings opportunities will most likely require involvement from suppliers to materialise. Contact them and brainstorm recovery plans that work for you – and for them. We’re all in this together, and we need each other now more than ever. Ensure that your plan doesn’t just benefit you and your business. Without your suppliers, doing business as usual post-lockdown will be even more of an uphill battle. Work out ways to manage cash flow so that your suppliers can stay afloat.

5. Communication

Arrange forums where multiple suppliers can come together to brainstorm solutions that would benefit both you and them. Appoint follow-on teams to implement the solutions after lockdown.

So where do we come in to all of this? Let us help kick-start your process. 

  • Send us your last year’s financial spend data.

  • We’ll analyse it and identify areas of potential savings.

  • We’ll provide guidelines and recommendations for savings, dependent on your industry.

  • Our experienced consultants can facilitate remote team meetings and guide discussions. We are available during lockdown.

  • We will also provide benchmarks to guide your team in exploring savings trends.

Next time you hear or read the word ‘lockdown’, don’t panic. You’re about to embark on a remarkable journey of adaptation, agility and growth that will propel your business into the future. 

Drop us a mail at info@supplychainpartner.com and let’s do this … together. 

Leigh Weimer is a principal consultant at Supply Chain Partner where she focuses on digital business transformation in sourcing and procurement. Being a lateral thinker with the ability to analyse problems, providing and implementing workable fit‑for‑purpose solutions, she is passionate about assisting clients during this process. Leigh is equipped with an MBA and a 20-year track record across multiple sectors: manufacturing, mining, pulp and paper, health, retail, petroleum and chemicals. Her expertise ranges from inventory and warehouse management, strategic sourcing, and procurement. 


Contact us for a procurement evaluation that will define what value means for you,

and help you achieve it.

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