Five Key Factors To Consider When Establishing Your Supply Chain Management

Managing a supply chain is a complex process. There are many factors that need to be considered and controlled, and all must work in harmony if you want your business to operate smoothly. That’s why we’ve put together this list of factors to consider within your supply chain management, so you can ensure you’ve ticked all the boxes and hopefully, therefore, avoid running into any issues.

Dealing With Freight

The first, and most significant part of managing a supply chain is dealing with freight. Products need to find their way to you in order to be sold and unless you’re operating purely out of a physical store, you’re also going to need to manage freight in terms of getting your product out to your customers. Unfortunately, this is also one of the most delicate areas of your supply chain as there are so many external factors that can impact how smoothly things run. If you’re not 100% comfortable and confident within this realm, we suggest looking into engaging the services of a third-party freight forwarder to ensure that things run correctly.

Customs Documents And Charges

Speaking of external factors that can impact your supply chain, customs charges and compliance requirements can be a bit of a thorn in your side if they’re not managed correctly. This will mainly be an issue if parts of your supply chain are regularly located overseas, but it’s also a good idea to be across the required documentation and compliance measures just in case, as a time may come when you need to source product from outside of your country of operation.


When working out the budget that you’re going to allocate to your supply chain, it’s important that you dig deeper than simply how much it will cost you to source a certain product or component from any given supplier. Minimum order quantities will play a large role in the affordability of a product, as will freight costs and customs charges if applicable. Because of this, your budget needs to take a more macro approach to allocate funds and will probably need to be reassessed regularly when you’re first starting out. Once you have an established and reliable supply chain you can stop adjusting your budget as often, however, inflation and general changes in costs will need to be factored in as they arise.


Woman handling the admin department of a supply chain

You’ll also need to think about administration requirements and how they will impact your supply chain. This includes everything from in-house documentation, to contracts with companies that you source goods from, paperwork for freight, and, of course, any paperwork that applies to your products or components themselves. Keeping on top of this side of things, although complex and time-consuming, is vital if you want everything to run smoothly, so getting your administrative processes set up correctly from the start is key.

Social Procurement

Finally, it is a good idea to consider working social procurement into your supply chain wherever possible. Social procurement is the process of sourcing goods in a way that means they offer more to society than their inherent value and is a great way to benefit the local community and environment as well as your business. For example, you may choose to buy from a small company that operates locally, rather than a larger business that is based further away. Not only does this help support small businesses, but it’s also better for the planet as your carbon footprint on each order will be reduced as products and components will have less distance to travel.

Now that you know what to consider when setting up your supply chain management, it’s time to get everything in place and get started – good luck!

Post Author: Lily Allen