Supply Chain Strategy - Navigating an Uncertain EconomyWith the economy experiencing historic trouble, it’s up to supply chain managers to plan for an uncertain future and secure their supply chain for whatever may come.

After months of dealing with a pandemic, the economy has taken a serious hit. What’s more, it’s hard to tell how long it’ll remain depressed. On top of that, there’s the added factor of uncertainty. Perhaps the worst of this pandemic is over, our economies will continue to open up gradually and everything will be back on track sooner than later. On the other hand, a second wave of COVID-19 might come, pandemic measures might be put back in place, and the economy might once more struggle.

All of this is not to promote pessimism but rather to present some possibilities of what the future has to hold for the economy. With an acceptance of these possibilities, there’s the chance at empowerment. In the face of uncertainty, it’s up to organizations to be proactive. To ready their supply chains for whatever’s to come. So that they can be comfortable and confident in the fact that come rain or sunshine, they’re good to go.

This article by Morai Logistics highlights several steps supply chain mangers should be looking to employ in order to prepare their supply chains for the future.

Review Suppliers

Many suppliers are in a tough position. Many of their preexisting contracts will be useless and their customers will want to renegotiate. Moreover, they’ll experience a notable decrease in demand from them. It’s critical for companies to then review their suppliers and strengthen their relationships with the ones that survive that review. Key to this is building trust and openness. Which, in turn, can lead to collaborative risk assessment.

As an article by Supply Chain 24/7 puts it,

Companies that have already invested in creating transparent, high-trust relationships with suppliers, and that put in place supply chain risk monitoring systems, are already reaping benefits. Others must now redouble efforts to reassess risks within their supply base and work jointly with suppliers to develop and implement risk mitigation strategies.

Renegotiate Supplier Agreements

With the market having changed so drastically so quickly, companies will have to look at their contracts with their suppliers. If there is a possibility of renegotiation, they should pursue it. However, what they almost certainly should not do is try to force their supplier’s hand.

Acting in bad faith and not receiving their supplier’s delivery while pursuing a price decrease is not the way to go. Instead, companies need to work with their suppliers for an equitable new contract. While it’s important to act quickly and deliberately, it’s just as important for companies to maintain strong relationships with their partners.

Reinforce Supply Chain Resilience

Now more than ever, the areas of weakness within a company’s supply chain are being exposed. It’s up to companies to review their supply chain, analyze it, and shore up its most vulnerable links. Not only will such a review be useful now, but it will generally prove beneficial going forward.

As explained in the previously mentioned Supply Chain 24/7 post,

During periods of growth, many companies find themselves moving too fast to carefully analyze their supply chains and eliminate suppliers that add little value or introduce unnecessary risk. Now is the time to scrutinize distributors and brokers, and aggressively pursue dis-intermediation.


It’s already become a common theme in this article, and there’s a good reason for that. Without working hand in hand with their suppliers—their partners—companies will only experience further disruption and turmoil down the line. Now is not the time to be short-sighted and narrow-minded. Companies with a vision know they have to build healthy, long-lasting relationships for success. Especially in times of hardship. Through a more transparent, collaborative relationship, supply chains will find it easier to spot risks and areas of cost reduction.

How to Reduce Waste in the Supply ChainWaste reduction is more important that ever in the modern supply chain—here are several ways to go about it.

This week our friends from the Compactor Management Company are contributing to our blog. The Compactor Management Company is a company that “has been providing all types of businesses with industrial trash and garbage compactors and balers.” They provide this service to businesses “in an effort to reduce their monthly garbage bills and generate the highest rates of recycling revenue.” Given their knowledge of waste management, we were more than happy to accept their proposed blog post. So, with further ado, here is their guest blog on material handling.

With the ever-increasing competition in the global market, it is natural for manufacturers and suppliers to focus on practices that yield high output at minimized costs. However, while employing practices to save cost and increase productivity, many companies fail to tap into benefits that effective waste reduction techniques offer. 

Not only does waste reduction keep the environment clean. It also creates new revenue streams, improves operational efficiency, helps businesses remain compliant, and improves brand image. So, here are a few ways businesses can reduce waste in the supply chain. 

Examine Product Design

Before the production process begins, examine the product design and identify the raw materials that may result in a lot of waste. After that, figure out if those raw materials can be replaced with materials that cost lesser and are less wasteful. By examining the product design, you can also decrease the amount of excess raw material and the use of hazardous material. Do both of these things to lower the quantity of waste generated. 

Review the Production Process

Who better to identify process inefficiencies than the production staff? So, talk to your staff and gather information on how waste material can be minimized. Moreover, brainstorming with the production staff may help you understand how to eliminate or replace materials that cannot be recycled. 

This will not only give the staff control over their job but will also motivate them to add value to the overall objective. 

Create a Preventive Maintenance Schedule

Wear and tear is normal in any production process. But excess wear and tear of the machines can lead to increased waste production. So, ensure that the machines are kept in good shape by having a regular maintenance schedule in place. This would not only reduce the waste produced but will also reduce the breakdown prevention costs and prove more beneficial for the budget. 

Practice Closed-Loop Manufacturing

A closed-loop manufacturing system helps you keep track of the inventory and utilize the recycled materials as raw materials in the production cycle. This system conserves the resources and also diverts waste from landfills. Also, in addition to reducing manufacturing wastage, a closed-loop system helps businesses lower their production costs.  

Put Quality Control in Place

If the supply chain lacks quality control, the waste production can go beyond the tolerable amount. Defective raw materials can affect the whole production process and result in more waste. Moreover, without a quality check, the final products can turn out to be defective and are more likely to be returned by the end-user. And even if the rejected product is recyclable, the cost of recycling it would be higher. 

Reduce Packaging Materials

Packaging produces a lot of waste. Hence, review the packaging design and analyze how you can minimize the use of packaging material. Focus on incorporating recyclable packaging material such as corn-based packing peanuts, air packs, paper and cardboard, biodegradable plastic, etc. 

Though waste reduction should be of great importance in a supply chain, how the waste is treated plays a significant role too. Hence, you must consider lucrative processing of scrap material through industrial balers. 

An industrial baler is the most sustainable solution that handles waste by compacting it and making it into small bales or bundles. Moreover, balers are designed to help businesses conveniently sort waste materials and prevent contamination of the waste. Other benefits of an industrial baler include: 

  • Savings on landfill tax and other disposal costs
  • Freed up space for other purposes
  • Improved health and safety at the premises
  • Extra revenue from recycling companies

Each level in the supply chain offers plenty of opportunities to reduce waste. So, start creating monthly and weekly reports to compare and identify ways to better the waste reduction process. 

Author Bio

Erich Lawson is very passionate about the environment and is an advocate of effective recycling. He writes on a wide array of topics. He informs his readers on how modern recycling equipment can be used by industries to reduce monthly wastage bills and increase recycling revenue. You can learn more about environment saving techniques by visiting his blog on Compactor Management Company.

Intelligent Supply Chain - 5 Reasons to Make the MoveSupply chains are are being forced to transform faster than ever in light of current circumstances—here are 5 reasons they should be becoming intelligent.

Recent times haven’t been easy on companies’ supply chains. They’ve had their suppliers challenged and resilience tested. In many ways the weaknesses of many supply chains have been laid bare and subsequently scrutinized. Why don’t companies have stronger protocols for handling disruptions? Why have some of them been so slow to respond to changes in global conditions and markets?

These important questions, and more importantly, the struggles that have been the source of them, have also meant that companies are looking for rapid improvement. And that means technological progress in the form of digital transformation. That’s where intelligent supply chains come in. In them lies the future of supply chains. A future where disruption is easier to predict, navigate, and respond to.

This ebook covers what intelligent supply chains are and the main advantages that come with having an intelligent supply chain.

What is an Intelligent Supply Chain and What Benefits Come With Having one?


That’s it for us this week! If you liked this blog post, why not subscribe to our blog? Interested in our 3rd party logistics services? If so, don’t hesitate to check out our services . We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

Supply Network - The Future of Supply Chains?The world of supply chain is in a constant state of change—does its future lie in transforming to a supply network? 

The supply chain of today is not what it once was. Where once supply chains were inflexible and one dimensional, they are now so much more. With the opportunities and risks that have come with globalization, there’s been a lengthening of supply chains. Not only have they grown in size but also in the way that they operate. Moreover, with recent events impacting supply chains the world over, they will only be transforming at a greater rate going forward.

However, it’s hard to say the agile, fast, personalized, and highly digitized supply chain that lies on the cutting edge of today and the baseline of tomorrow should really be called a chain anymore. Instead, it’s time to see it for what it is: a network. As supply chains continue their growth, the next step in their evolution is becoming a supply network. And, with that evolution, they can mark a new standard for the production, movement, and delivery of supplies.

This article by Morai Logistics explains what a supply network is and why supply chains should be (and are) moving towards becoming one.

What is a Supply Network?

A supply network is a more comprehensive, dynamic, and multifaceted supply chain. The traditional supply chain has been linear, with the company focusing on its own product. A supply network takes a more holistic approach. An approach that puts more emphasis on the customer and thus looks at the supply chain from beginning to end.  Thus, it can involve more than one organization working together to give the end-customer the best value possible.

Here are some key features of a supply network.


Central to the more robust and complex supply system that is a supply network has to be digitization. Without digital transformation, it simply isn’t possible to have the visibility to oversee operations as precisely as needed. Furthermore, digitization gives companies the infrastructure for further technological advancement needed for a supply network. These advancements being (but aren’t limited to) artificial intelligence, machine learning, automation, and IoT.


The precise, continuous, and thorough collection of data throughout all operations is vital to a supply network. Due the greater complexity of a network, it’s even more important to have data gathered for it. That valuable data, in turn, has to be consolidated so that supply chain managers can get an overview of their operations.

An article by Supply Chain Digital further emphasizes the value of data for a supply network,

Many of today’s supply chains are largely analogue, so even applying near real-time insights often require manual human intervention; in a data-driven world, this is unacceptable. Every aspect of the supply network must be integrated and a great deal of insights-based decision making can be automated, ultimately improving overall speed and effectiveness while driving down costs and reducing errors. Developing this capability depends on the ability of the organisation to bring data to the center of each business function, so companies must be more deliberate in organizing themselves in a way that embraces data-enabled technology.

Concurrent Planning

A network also requires more powerful planning. This involves several things. For one, that means automating planning so that its more efficient and frees up labour. On top of that, planning should involve both demand planning and supply planning. By having these planning systems running at the same time on a unified platform, they can work hand in hand as opposed to apart or even worse, opposing each other.


Finally, a significantly overlooked feature of a supply network is the culture it requires and fosters. Due to the nature of a supply network—that it touches and improves upon every aspect of a supply chain—it impacts practically everyone involved in an organization. As such, it is up to the leaders within a company to remind employees of the coming changes and instill positivity and belief in the transformation. Without the workforce buying into a supply network, it can’t get going.

Demand Sensing - 5 Ways it Helps Supply Chains Deal with UncertaintySupply chains are having to deal with uncertainty now more than ever—here are 5 ways that demand sensing is helping them manage it.

Today’s supply chain’s success is marked by the speed at which it can respond to the demands placed upon it. Companies have to be able to deal with the unexpected. Fast. There can often be sudden changes in what customers want. And it’s up to companies to have their supply chains sufficiently prepared for them. As such, technology has become central to the strength of supply chains. Specifically, with demand sensing, companies have a technology that gives them an opportunity to react to customer demands with greater speed and precision than before.

Demand sensing is an incredibly accurate way of forecasting. It’s a software that uses close to real-time data to give companies a picture of upcoming demand. With it, companies are put in a stronger position to deal with short-term fluctuations in the needs of their customers. Improving their supply chain planning and resilience.

An article of demand sensing by Supply Chain Brain explains,

Demand sensing, as the name implies, is essentially the art and science of picking up on short-term trends immediately, in order to better predict what consumers will want.

This article by Morai Logistics covers 5 ways companies can be leveraging demand sensing to bring clarity to their supply chain operations.

Boosts Upstream Planning

One of the most important points of information that companies get access to via demand sensing is point of sale data. By having this data, companies can know the state of their materials and products immediately. This in turn allows those in the manufacturing sector of companies to further fine-tune their forecasting without relying on others in the supply chain.

Helps Keep a Closer Eye on Inventory

The earlier mentioned Supply Chain Brain article highlights demand sensing’s impact on inventory,

Continually fine-tune upstream inventory. Demand sensing helps to dynamically optimize inventory and balance the network by factoring in inventory available in regional warehouses, along with predicted customer demand, by location.

What this means is supply chain managers can have a clearer view of their inventory in all its various locations. This results in supply chains being run more efficiently, avoiding waste, and being primed to be able to respond to customer demands.

Creates Balance Between Inventory and Sales

Inbound and outbound teams have opposing objectives. The inbound team wants inventory fully stocked. Whereas the outbound team wants everything sold. Both of these goals are critical to a healthy supply chain. However, if they don’t reach some degree of equilibrium it can spell trouble. Demand sensing helps avoid that by presenting a fuller, unified image of the needs of customers.

Makes Seasonal Demand Easier to Tackle

The products a company sells can change greatly by the season and the corresponding demand can too. Thus, the change of each season can be a testing time for supply chains, as they attempt to adapt to those changes. With the assistance of demand sensing, that’s easier to manage. This is because of the near real-time nature of the data collection and feedback. If any item is selling below or above expectations, companies can know immediately and respond accordingly.

Ensures Inventory Matches up with Product Lifecycles

Every product companies put out there are only going to be sold for so long. Each product has a lifespan. A point at which demand dwindles. And it’s up to companies to anticipate and plan for the lifespan of each product they put on shelves or deliver directly to customers. Once again, demand sensing makes this process simpler. Primarily by giving companies such accurate and quick feedback.

Supply Chain Disruption - 5 Steps to Overcome itWith COVID-19 causing havoc on supply chains the world over, being able to handle disruption has become more important than ever. 

Companies are currently facing unprecedented obstacles with the advent of COVID-19. Not only is it presenting significant issues for warehouses and those working in them but also the ability for companies to utilize their supplies. This is only being exacerbated by the growing demand for delivery by customers as so many of them are limited to their homes at present. As such, COVID-19 has been the greatest source of disruption to supply chains globally in memory. And that, in turn, means companies have to reinforce their supply chains if they’re to survive.

An article by the World Economic Forum highlights the unforeseeable nature of supply chain disruption and the numerous harms it can have,

…the triggers of supply chain disruption are hard to predict, and sometimes neither controllable nor influenceable. The robustness of networks is paramount to ensuring demand can be met with supply even in extraordinary times. COVID-19 and related responses are delivering an extraordinary shock both on supply and demand sides to the global economy – by shuttering production and cutting consumption – even as demand for healthcare materials soars.

This article by Morai Logistics covers 5 steps companies should be taking in order to manage the disruption of their supply chains.

Create an Overview of Your Supply Chain

Immediately, you should map out your supply chain. This is so you can get a better sense of the state of your supply chain and suppliers, as well as its ability to handle impediments. It is only through an overview of your supply chain that you can evaluate the risks it faces and work towards overcoming them. Critically, you need strong visibility throughout your chain in order to do this effectively. Thus, if you struggle with mapping your supply chain, that’s the first issue to address.

Contact Your Procurement Team

Your suppliers are typically hit the hardest with a disruption event. With that in mind, it’s important to reach out to your procurement team and talk about your suppliers. When you do, you should get a good sense of where your suppliers are located and how significantly they’ve been impacted. Through this knowledge you can get a sense of whether you need to diversify your suppliers. Moreover, this knowledge will also prepare you for any further disruption.

Check on Your Suppliers

This may appear to be a redundant step, given the last one, but it isn’t. Both steps are important. The last, to get a general sense of the state of your suppliers. This step, in order to get the finer details you might be missing. So, directly contact your suppliers and get a more precise picture of how they’re doing. Ask any outstanding questions you might have so you can be certain before making any decisions regarding them.

Seek Out New Data to Assess Demand

Due to the nature of a disruption, your preexisting demand data won’t be useful. A disruption, particularly of the scale of COVID-19, will alter the complexion of your demand. With that said, you’ll need to look for new avenues of data in order to accurately ascertain demand.

Focus on Risk Management

Once you have completed all the previous steps, you’ll be in a strong position to elevate your ability to handle risk. Look at all the holes in your supply chain the disruption exposes. Address each risk head on. Make risk management a priority. Ensure that both this disruption and the next are something your company can handle with confidence.


Building a Stronger Supply Chain - 4 Steps to Resilience
In these uncertain times, supply chain resilience is more important than ever—here are 4 steps companies can take to strengthen their supply chains.

With supply chains operating in an increasingly challenging climate, now, more than ever, they require resilience. Resilience is many things. In some part, it can be a mindset and a culture that, when embraced by a company, makes it more responsive and unerring in the face of unfortunate develops that negatively impact its supply routes.

However, resilience is also something that can be planned for and built into a supply chain. There are a number of measures that can and should be taken to bolster supply chains so that they have the inbuilt fortitude to weather any storm. Coupled with the requisite mindset mentioned above, this can put companies of firm ground even in the most testing of times.

This ebook covers the 4 key steps to drive companies towards more robust, agile, and adaptable supply chain operations.

What is the Path to a Healthy Supply Chain, Fit to Handle Whatever Unforeseen Circumstances That Comes its Way?


That’s it for us this week! If you liked this blog post, why not subscribe to our blog? Interested in our 3rd party logistics services? If so, don’t hesitate to check out our services . We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

Material Handling Tips That Every Factory Worker Must Know AboutSafety in factories is paramount—here are some material handling tips for factory workers.

This week our friends from Quality Scales Unlimited are contributing to our blog. Quality Scales Unlimited is a company that “sells all types of scale equipment, from highly sensitive lab scales to heavy capacity truck scales.” (Learn more about them here). Given their knowledge of proper protocol on the factory floor, we were more than happy to accept their proposed blog post. So, with further ado, here is their guest blog on material handling.

It is common to see workers handling or moving materials in a factory. However, if it is not done right, it will result in accidents, pain or handling ailments like repetitive strain injury. The dangers of improper handling, storing or moving materials are plenty. Let’s learn how to avoid them.

Safety While Moving, Handling or Storing Materials

  • If the workers are moving the materials manually, they should take help if:
    a) the load is too heavy,
    b) when they cannot see around or
    c) cannot handle the load safely.
  • You must meet the weight regulations of trucks and forklifts to make sure they move the materials safely. Weighing scales like a floor weighing scale can help you avoid overloading the vehicles and ensure safe floor operations.
  • To prevent the fingers from getting pinched, handles should be attached to the loads.
  • Observe height limitations when you stack the materials.
  • All the workers must wear personal protective equipment while moving, storing or handling the materials.
  • The stacked loads must be piled and cross-tiered correctly.
  • Keep the storage areas from materials that can cause tripping, explosions or can harbor pests like rats.
  • Stack the bar stock, structured steel and all cylindrical materials to prevent spreading. The boxed materials must be held in place using cross-ties.
  • Equip employees working on stored materials in hoppers, silos or tanks with safety belts and lifelines.
  • Post the load limits approved by the building inspector in all storage areas.

Ergonomics of Material Handling

Ergonomics refers to the layout of the work space – its design, and how, where, why materials are kept. These include safety devices, controls, function of workstations, displays, lightning and tools to fit the employees’ physical requirements.

An ergonomic factory will minimize the risks to the employees’ health and ensures their well-being. It includes changing the workspace conditions or restructuring to make the workspace better and easier for the workers. The aim is to avoid repetitive motions that can cause injuries or traumas.

You may have to change the way workers can lift and move objects or reduce the materials’ size and weight. For instance, you can install lifting equipment or train the employees in the right lifting techniques.

Along with the material handling training, provide them basic safety training too. These include practices like always keeping the aisles clear while moving materials or fire safety precautions.

Provide Employee Hazard and Safety Training

If materials are not handled properly, there will be hazards. It is important that the employees learn how to recognize them. Organize training programs that teach the workers everything they need to know about materials handling, storing and safety.

Some things to include in the training:

  • Workers must be aware of what they can handle comfortably without straining themselves.
  • Workers should be able to identify different dangers associated with lifting materials without having the proper training.
  • Recognize the physical factors that can contribute to an accident and being aware of risks of lifting improperly.
  • Teach them how to use handling equipment and handling aids such as shoulder pads, platforms, stages and handles properly.
  • Teach the workers about basic anatomy of the muscles, spine and where the body will feel pressure while lifting materials
  • Show the employees how they can avoid unnecessary physical strain and stress.
  • They must be aware of their body’s physical limitations and lifting capacity.
  • Train them to use safe lifting postures for smooth lifting and how they can minimize load-moment effects.

Hold regular safety meetings so that the workers stay updated of the precautions. Encourage them to have an honest conversation if they face any problems or feel any pain while moving or lifting the materials.

Author Bio:


Kevin Hill heads the marketing efforts at Quality Scales Unlimited in Byron, CA. Besides his day job, he loves to write about the different types of scales and their importance in various industries. He also writes about how to care for and get optimized performance from different scales in different situations. He enjoys spending time with family and going on camping trips.

Blockchain Technology - 4 Questions to Consider Before Adopting itBlockchain technology could be critical to supply chains going forward, but its implementation shouldn’t be taken for granted.

Blockchain, despite the many concerns remaining around it, continues gaining traction in the world of supply chains. This interest is only being accelerated by the increased digitization of supply chains operations by businesses. As such, increasingly, companies are either entering the consideration phase or early adoption phase in regards to the technology. With that in mind, its critical that those companies that are still in the consideration phase or are about to enter it know the unique challenges that come with blockchain technology before they proceed.

As an article by Consensys explains,

The list of industry-leading enterprises building on the blockchain spans tech leaders (Microsoft), financial institutions (JP Morgan, Santander), and even national governments (Singapore, Dubai, Brazil). But as with any emerging technology, there are some particular and unique quirks and obstacles that all early adopters will face along the way for which even the savviest business leaders considering blockchain solutions should be prepared.

This article by Morai Logistics presents 4 questions that are integral to optimally integrating blockchain into your supply chain operations.

Why do Your Operations Require Blockchain?

When evaluating the need for something, you have to start from the ground up. Blockchain is no different. Why does your supply chain need it? How will it be elevated by it? You need to have a good understanding of the nature of the technology and have it align with the running of your supply chain and the goals you have for it.

A piece by Supply Chain Management Review underscores the nature of a blockchain project,

Blockchain is not an IT or R&D project; it is a fundamental business transformation tool which, if properly implemented, will significantly impact revenue and cost. Blockchain excels where information is shared across an enterprise, as well as with suppliers and customers.

Essentially, you have to assess blockchain and its key features. Upon doing so, you have to ask why your supply chain requires those features.

Do you have the Infrastructure for it?

Blockchain has certain requirements in order to be applicable. If your company doesn’t have the architecture in place for its supply chain to support the technology, then that’s another undertaking it’ll have to commit to alongside blockchain implementation. Key amongst these requirements is digital transformation. Without being digitized, the technology will have nothing to run on.

Are you Planning to Scale Your Operations?

One of the persistent concerns surrounding blockchain technology is its trouble scaling. With that said, you need to know if your company plans on expanding its supply chains operations. If so, implementing blockchain might hurt and slow down those efforts. However, there are a variety of blockchain platforms providers. So looking into which provider is best suited to supporting your plans to scale might somewhat mitigate this issue.

Are you Prepared for the Regulatory Hurdles?

Despite being a technology largely based around transparency, certain facets of blockchain can make it push up again government regulations. In fact, ironically, some of its key features that see it touted as transparent and secure, are features that can run afoul of the regulatory hoops companies have to jump through. Thus, one more consideration you have to take on board, is whether you’ll be compliant with the rules that are in place.

The previously mentioned Supply Chain Management Review article highlights this point,

While regulatory compliance is a frequently mentioned application, in reality, compliance and regulatory issues can present a challenge. As an example, immutable records are a part of blockchain, but this can be a problem when records need to be changed.

Circular Supply Chain - What is it and Why is it Important?With companies putting greater emphasis on sustainability than ever before, it’s critical to understand what a circular supply chain is and how it functions. 

Today’s supply chain is one that caters its practices and operations to customer demands as precisely possible. In turn, few things rank more highly on the list of customer concerns than sustainability. Not only that, but the need for sustainability is also being driven forward by governments around the world, with numerous penalties and incentives for companies that are more or less compliant with their regulations and guidelines. As such, companies are quickly making a transition to ‘green’ supply chains. Supply chains that are less wasteful, use materials that are recyclable, leave a smaller carbon footprint, and more.

However, making that transition is far from easy and requires a holistic change in the way that supply chains are operated and managed. Essentially, companies need a new operating model. This is where the concept of a circular economy and circular supply chain comes into play. These concepts mark a paradigm shift; a novel way in which companies can design their supply chains for sustainability going forward.

This article by Morai Logistics explains what a circular supply chain is, how it works, and why its significant.

What is it?

A circular supply chain is a supply chain that is geared around reusing its ostensible waste materials as well as its returns. It aims to take these materials and returns and convert them into new products that they can sell once more. Thus, it marks a shift for supply chains. A shift in which waste as its traditionally known no longer exists or is kept to a bare minimum. Naturally, this also means near-perfect sustainability.

An article by Trade Ready elaborates further on the nature of circular supply chains and what they look like,

A circular economy is alternative to the traditional linear economy (make, use, dispose) in which we keep resources in use for as long as possible, extracting the maximum value while the product is in use. When the product has reached the end of its life-cycle, then core materials are recovered and regenerated. The circular economy is waste-free and resilient by design.

Why is it Important?

It is a new model for supply chains because, by its very nature, it fulfills a need companies are desperately trying to meet. That being the above mentioned need for sustainability. It flips many previous intuitions on their head. In a circular supply chain, there’s value in waste. Where waste is normally seen as a source of weakness, a circular economy makes it a resource. A resource that’ll translate into more products.

Moreover, its not only a forward-thinking model in terms of its outcomes, but also in its management. Crucially, it marks another step towards the marriage of technology and supply chain practices, as digitization is key in enabling a circular supply chain. With that in mind, perhaps the next big thing in supply chain technology could be an all-encompassing system that enables companies to ‘go circular” as currently they have to adopt several technologies to do so.

A recent post by Supply Chain Digital emphasizes both the points above,

“The circular economy creates an ecosystem of materials,” commented Sarah Watt, senior director analyst with the Gartner Supply Chain practice. “What was previously viewed as waste now has value. However, those ecosystems are complex and include many interdependencies and feedback loops. Digital technology has the potential to provide visibility and enable improved decision making when it comes to raw materials and services”…study showed that there is no ‘all purpose technology’ that will enable an organisation to develop a circular economy, it is a combination of technology that leads to this.