10 best ways to reduce your supply chain costs

10 Best Ways to Reduce Your Supply Chain Costs

By reviewing some aspects of your business, you will be able to reduce supply chain costs.


Cut Cost

With all industries focused on the bottom line, cost saving is a hot topic for most companies. In the past few years, businesses have increasingly pay attention to the supply chain to see how they can reduce its costs. Large players like Amazon are also putting pressure on the rest of the market to lower costs while still delivering higher, quicker service levels. There are many areas where costs can be reduced in the supply chain process – some less obvious than others.


Key Areas to Focus on to Reduce Your Supply Chain Costs


Property & Warehouses


Warehouses is undoubtedly a big investment but can also save money if properly managed and handled. One way to reduce its costs is by having more multi-client properties. In the past, many have stayed away from multi-client properties to avoid commingling with competitors. But now, sharing space with other businesses means that costs are spread out among everyone in the property, which can result in significant savings.


Make Better Use of Space


By making use of the space to its utmost limit, will save you money at the end of the day’ is surely a thing that already know. And storing inventory and supplies in your warehouse comes at a cost. So assess whether or not you’re making the most of the space you have. You just might discover that you could actually save some money by finding a space that’s more in line with your actual needs.


Labor Costs


Cutting labor costs doesn’t necessarily mean physically decreasing the number of workers on staff. Through smart management, labor costs can be reduced greatly without sacrificing any workers. Better management of a workforce can lead to less turnover and a more diligent team that in turn can decrease missed shipping deadlines and other occurrences that affect costs.




Automating processes in your warehouse can actually help you to accomplish your goal of reducing supply chain costs effectively in the most efficient way. With Intellinum Express Server (oracle integrated solution), you can automate or streamline transactions with defaulting values, automating keystrokes, hiding unused fields and integrating multiple transactions.


Improve Visibility


The supply chain is no longer linear, it’s comprised of multiple touch-points that increase the need for unshakable visibility. Strong forecasting software, along with a thorough understanding of your business to foresee seasonal perks and changes in shipping demands, can aid in avoiding inventory and transportation cost issues.


By regularly looking at client demand patterns to see whether or not something needs to be tweaked. You may find that patterns change from month to month or from season to season, and you can use this information to make more accurate supply ordering decisions.


Streamline Ordering Process


You need to make your ordering process as efficient as possible. This means at least a couple of things. Use a software package with simple process that allows employee to operate it efficiently and also give you the capability to personalize it as you need – if you are using oracle WMS, our Express Server solution can help you achieve this. Another thing to keep in mind is that you need to implement an approval process so that nothing gets ordered without the consent of designated officials. These simple steps will help you to reduce supply chain costs.


Secure Packaging


The better you package your products, the less likely your products will be damaged when shipped. Ensure that whoever is responsible for this function properly packages and stacks your product so as to avoid, or at least minimize the chances of, damage.


State-of-the-art Technology


Another way that organizations can cut costs is by implementing new technologies such as the latest cloud WMS solutions. New technologies may cost more in the upfront but typically the return on investment is high and can save companies thousands of pounds.


From using RFID technology for inventory tracking to using software designed specifically for warehouses with multi-level decision makers, your IT expenditures (or the lack thereof) can influence your ability to build a profitable warehouse business.


Some other new technologies that have recently surfaced that are saving 3PLs money include the lithium ion battery, manned AGV forklifts and automation tools.




Outsourcing is one option you can consider if you want to reduce supply chain costs. Of course, you’ll need to conduct proper due diligence to ascertain whether or not service providers under consideration have the ability to provide enough of a productivity and efficiency benefit to justify your out-of-pocket expenses for such services. Under the right set of circumstances, an outsourcing arrangement can lead to substantial savings and a property functioning supply chain.


Utilizing Business Data


Make sure to tap into the wealth of insights your internal information provides. Pulling data from several sources like parcel, transportation, warehouse, labor, and payroll departments creates a big data scenario, empowering you to get better information and make smarter decisions. Notably, integrating data from several sources provides a comprehensive view so you can more accurately plan inventory in your network. With business intelligence integrated into your planning, you can have more confidence that your network is not creating bottlenecks that slow down delivery and increase costs. Your WMS will supply you with a wealth of information resulting in reduce supply chain costs.


In Summary


Cost saving is an important aspect of any business, but it is important to not cut corners when trying to cut costs. Every aspect of the supply chain should be open to investigations, as uncovered revenue opportunities could be substantial. It is in an organization’s best interest to examine everything from your logistics providers and shipping methods to the placement of inventory in your warehouse. Chances are you’ll be surprised at just how efficiently you can run your business and enabling you to reduce supply chain costs at the same time.