North American companies are losing an estimated $1.8 trillion every year due to inefficient supply chains—nearly 8% of the region’s total GDP. That’s not just a staggering number; it’s a wake-up call.
Where the Money Disappears?
The losses come from multiple fronts:
- Inventory holding costs from poor demand forecasting
- Capital tied up in excess stock and rising warehouse expenses
- Transportation inefficiencies due to bad routing and unreliable carriers
- Labor waste from slow order fulfilment and production bottlenecks
- Lost sales and customer dissatisfaction when products aren’t available
- People lacking the correct skills
- Processes are lacking and have not kept pace with a business that as scaled
- Systems that do not support a data driven decision making process that is both efficient and effective (ERP system)
- Waste levels across all input resources are excessive
- Productivity is not understood, measured and acted upon
Why It’s So Shocking?
Supply chains are the invisible backbone of every business. They span departments, geographies, suppliers and customers —yet they’re often underfunded, underappreciated, overlooked and mismanaged. When they break down, the ripple effects hit hard: missed revenue, rising costs, low customer service and strategic paralysis.
What’s the Fix?
Areas to focus on include:
- Overall supply chain Management
- SHEQ (Safety, Health, Environment & Quality)
- Ensuring alignment in metrics across departments
- Alignment between Strategic, tactical and Operational metrics
- Continuously driving improvements in the People, Process & Systems elements of an organization
- Sales & Operations Planning
- Appropriate use of technology (Automation, AI, IoT)
- Data driven & System thinking approaches
- Procurement and supplier diversification
- Understanding Route to Market (Imports/Exports & Tariff structures)
- Productivity, Productivity & Productivity
What’s the Payoff?
Companies that invest in smarter supply chains see:
- Significant cost savings
- Improved efficiency
- Accelerated growth and competitiveness
In a world where speed, accuracy, and resilience define winners, fixing supply chain inefficiencies isn’t optional—it’s mandatory.
What specific challenges are you facing in your supply chain operations? Maybe I can offer some tailored advice!
Let’s Take Your Business Further. Ask me how.
Dr Kenneth Moodley LinkedIn
