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How to Optimize the Construction Supply Chain

commercial construction distribution

There are many factors that can have a negative impact on your supply chain. Natural disasters can disrupt shipping routes and result in delays. Business problems can force a supplier to shut down operations. And network issues or even cybercrime can temporarily cripple an organization and leave it unable to fulfill its commitments.

Of course, when you’re in the middle of a project, the last thing you need is a late delivery that throws off your entire schedule. This results in time and cost overruns, as well as unhappy clients. That’s why it’s critical to optimize your supply chain. For more on commercial construction distribution and logistics, get in touch with LevelXSupply!

Key Points

  • Send out RFQs. The Balance advises that you can use request for quotes — or RFQs — to get estimated prices and product data from multiple suppliers at the same time. This will help you get the best deals. Don’t just look at price. You should also consider factors such as product quality, speed of delivery, consistency of supply and level of service.
  • Create a list of alternative suppliers. Do you have a plan B in case one of your primary suppliers can’t deliver? If not, now’s the time to make a list of second-choice suppliers for every product you need so you have a back-up plan when needed.
  • Share data regarding your demand with your suppliers. If you see a busy season or a slower period coming up, inform your suppliers. This helps them better meet your demand when you’re ordering more. And since the costs of overstock are frequently passed on to the customer, it also helps you avoid higher costs when demand is low.
  • Leverage a cloud-based platform to connect with your suppliers. As Supply & Demand Chain Executive points out, this ensures that everyone in the supply chain has access to the same data in real time — and eliminates the possibility of errors due to timing and miscommunication.
  • Regularly assess your suppliers’ performance. Evaluate whether they’re still delivering quality products on time and for a competitive price. It’s also wise to see if there are any newcomers on the market that might offer you a better deal.

According to Deloitte, the construction industry is likely to experience accelerated growth through 2019. As a result, there will continue to be plenty of opportunities for construction firms and contractors — and optimizing your supply chain will help you make use of these opportunities to grow your business.