Frequently Asked Questions

What is a supply chain?

This represents ALL activities that go into producing a product or service, from your supplier’s supplier to the product reaching the consumer. This includes the broad areas of Plan, Source, Make (manufacturing and packaging), and Deliver (warehouse and distribution). It is all steps that go into converting raw materials into a finished product. Whilst we focus on the forward process, bear a thought for what your return process looks like (reverse logistics).

What is a value chain?

A value chain are typically those activities that create or add value to the product. In other words, the value chain is adding ‘something’ to the product that the consumer or customer is willing to pay for.

Is supply chain a good career choice?

Supply Chain is a terrific career choice for anyone. It is common to find that individuals interests, goals and career choices changes over time. A benefit of careers is that there are many options and career choices to which you can easily change too.

What does a good supply chain look like?

A good supply chain is one that adds the maximum value to a product or service whilst generating minimum waste. These supply chains have people that have the right capability and display the correct behaviour in contributing towards improving the supply chain. A great supply chain must have the right people, right processes, and right systems. It must continuously focus optimising with the entire organisation realising that the improvement journey is continuous.

How can supply chains be improved?

There are various methodologies and techniques that can be used to improve supply chains. Some of the ways to improve your supply chain is:

• Optimise your distribution network. Inclusive of warehousing, logistics and the order to cash process

• Monitor all aspects of your working capital and cash flow (example: Inventory levels, creditors and debtors)

• Track inventory (raw material, packaging material, finished goods, engineering spares, etc.)

• Drive carbon footprint reduction projects

• Establish sound KPI tracking and performance management

• Ensure the strategy is converted in sound tactical and operation plans with performance metrics

What is optimization in business?

Broadly speaking any business that wants to improve must start with measuring what it deems to be important (Key Performance Indicators). It can than adopt various optimisation techniques to drive continuous improvement.

How do SMME’s benefit the economy?

Small, Medium and Micro Enterprises (SMME) are considered to be a key contributor towards economic growth. They tend to provide more employment opportunities than that of other business size categories. This is largely driven by the SMME sector having a lower “capital cost to create a job” than big business. Another factor is that SMME’s are typically more focussed on manual operations versus automation.

What is Lean?

The lean methodology or philosophy is a way of optimising all aspects of the business by identifying waste and adopting techniques and tools to eliminate them. It focusses on optimising the people, resources and effort of the business with the goal of enhancing the value that is created for the customer.

Why should business focus on cash flow?

A strong cash flow enables the business to balance what it needs to spend and when it would collect cash from the customer. There is almost always a time lag between spending and receiving cash. If you cannot spend money to purchase what you need it will negatively impact your sales. Understanding your cash flow will help you in make sound business decisions.

Why should any business consider using a business advisor?

Most businesses either do have the internal skills or time to focus on improving and taking their business and supply chain to the required levels. Most will be busy with the daily operational firefighting and hence not take a helicopter view. Having a well-qualified, skilled and experienced business advisor will enable you to drive your business in the direction you want.

Where do I start if I want to improve my business?

You can start by contacting me for a brief discussion. During this session we will understand what your challenges, symptoms and pain are. I will than advise on the way forward.

How much cash should a business keep in reserve?

The short answer is that your cash reserve should be sufficient for you to feel comfortable running your business. Some experts recommend having three months of expenses. Others recommend six months. I would suggest speaking to your CPA or financial adviser to determine the right number for your business. Also depends on lead times to pay and receive monies. Risk that is inheretnt in your business will dictate the amount as well

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