POs Left Behind Can Spell Disaster for Sales — Here’s How to Prevent It
It’s a helpless feeling when you see that seven shipments were created from purchase orders that should have required 10. “What was left behind?” you might wonder as you rush to see if the freight forwarding company gave any indication of what products made it into which containers. But when you access the site and enter the shipment numbers, you see nothing — the shipment ID, pickup date, and requested delivery date are all you have.
Situations like this unfold daily across a global supply chain, and the problems are exacerbated in the midst of disruption. Today, global shippers are struggling with ocean container capacity issues and, as inventories begin to shift back towards growth, many are considering whether they need safety stock to offset issues with vendor fulfillment.
The bottom line is that a lack of order-level insight can be bad for your… bottom line.
Understanding that certain orders might be more impactful than others should be a simple concept for any shipper. If you’re a retailer, you’d likely want to have the choice to have your Halloween candy fulfilled over your Christmas candy in August. You may be at the mercy of your manufacturer deciding to ship a bit of both to split the difference, dramatically short-filling your Halloween order.
Alternatively, it might not be the order in which you intend to use the items. At a production facility, for example, you might need to weigh the tradeoff between fulfilling your catalytic converter or replacement part orders — which is more important? Only you know.
When it comes to managing your inbound purchase orders, three key improvements will save money, improve on-shelf availability, and put you in control over your inventory flows:
That’s not to say ignore shipment-level data; that’s important, too. But your decision makers and virtually everyone outside the transportation team only worry about managing order exceptions. Being able to retrieve information quickly about the performance of any order, starting before the freight forwarder even tenders it, can mean days of advance warning that something is awry.
For instance, if a PO has a must-ship-by date of the 7th, they can create an exception telling them that a shipment hasn’t been created by the 3rd to warn them that they need to intervene and investigate the issue. Advanced supply chain visibility platforms that manage orders as an object independent of (but in connection with) shipments can help teams track exceptions throughout the entire order lifecycle, even before a shipment is created.
Based on the rate at which your business moves, you likely have glaring inefficiencies that are going undetected simply due to the lack of reporting. When experiencing multiple missed POs, being able to identify the root cause and analyze trends contributing to this pattern can help you rectify the situation. Reporting on days spent in each part of an order’s lifecycle will give you enough historical data to make changes and alleviate some of the bottlenecks that aren’t attributed to carrier, vendor, or product category issues.
Your PO will inevitably find its way aboard a seaworthy vessel and start its journey — but any seasoned supply chain practitioner will happily tell you that you aren’t out of the woods yet. Its performance is still critical to monitor. Whether it gets stuck waiting for a berth or stranded in a rail yard, a lot can happen on its journey.
Having order- and SKU-level visibility in these circumstances can give non-transportation teams critical insights into exceptions that their orders encounter. They may decide that expediting an alternative from a higher-cost vendor is worth more than empty shelves during a holiday promotion.
As your PO rounds the bend and arrives at your final destination, how do teams know which trailers to prioritize? And are they truly aware of their contents? Odds are, if you asked one of your warehouse managers, they’d tell you a story about how, one day, a handful of their associates had to go trailer-by-trailer to try to locate a specific item. Or they may tell you about how they had an outbound PO prepared and were sure that the last SKU they needed to complete it was in the trailer they were just opening up — just to find out it wasn’t the trailer they needed. Your warehouse teams need just as much visibility and assurance of their facility’s inbound and parked trailers as anyone else in your supply chain.
Global supply chain management is tricky, which is why safety stock helps alleviate some of the anxiety. But with higher inventory carrying costs, warehousing demand, and excess stock at the end of a season, you might end up paying way more than you bargained for.
FourKites is the only visibility provider that offers global, multimodal visibility with free-flowing orders on its platform. That means earlier exception management, tracking in a context that matters for many, and pinpoint accuracy in identifying a disruption’s true business impact.
If you want to find out how FourKites can help your entire business use its supply chain to its full potential, contact us at [email protected].
