A New Paradigm for Supply Chains and Sales Channels

SUPPLY & DEMAND AS AN ECOSYSTEM

There is a fundamental shift happening now in the way goods are produced and sold. The traditional “workshop of the world” model, where manufacturing was concentrated in limited geographic regions, is being replaced with a broader, decentralized approach to production and supply chains. Piggybacking on this shift, sales and distribution channels are evolving as they navigate an expanding range of suppliers in new and diverse regions.

We believe this is an inevitable shift, shaped by the evolving global business landscape. But this shift has been expedited thanks to the pandemic, as well as an increase in environmental awareness combined with a growing public demand for measurable economic development.

Strategy, equitability, and sustainability are three of the forces driving this shift across all industrial sectors and market segments. What follows is a brief overview of those specific forces, with a glimpse into anticipated outcomes as relevant companies, like Inrepco LLC, fill market gaps in global supply chains and sales channels.?

STRATEGY

The pandemic has forced business to rethink strategy, from day-to-day operations to long term planning. Shortages, real and perceived, from FMCGs to steel, electronics and transportation, have impacted consumer behavior across all time zones, while shipping and travel have been disrupted beyond anyone’s expectations.?

To a greater extent, the reliance on suppliers concentrated in particular locales has exposed a dangerous weakness in supply chains. The danger lies in taking the familiar for granted. In this case, it was the assumption that suppliers and shippers would continue to perform as they always had, without future hitches in production or transportation. It was the lesson of keeping all your eggs in one basket, but for industry. And now, with disruptions across most business operations, companies are forced to seek new and alternative suppliers on a massive scale and in record time.

Although having alternatives, especially for critical suppliers, is a strategic hedge against unforeseen problems, it was often treated as an afterthought or unwelcome expense in larger, bureaucratic organizations. That attitude is changing, from warehouses to boardrooms, as net margins are squeezed and purchase orders left unfilled. Corporate executives, themselves accountable, are actively seeking and adopting strategies to remain competitive while minimizing the risks of single supplier dependency.

The good news is that the strategic advantages of decentralized supply chains far outweigh the disadvantages. Given today’s shaky business environment, companies and governments are more motivated than ever to embrace the shift towards diversity in suppliers. Reliance on one key supplier is being replaced with safer options, extending supply networks with multiple vendors while trimming risks of shortages and severe price fluctuations.

EQUITABILITY

In this case, we are referring to access, fairness, and accountability in the global business arena. The “that’s how we’ve always done it” mindset is being challenged by new and upcoming supply chain and sales channel professionals. These individuals and their companies are attempting to balance ethics with profit, as is reflected in their updated HR and administrative policies. And this shift is not limited to corporate heavyweights placating young hires. From rising startups to stodgy government procurement agencies and corporate buyers, there is a noticeable adjustment in tolerance and a strong willingness to give consideration to alternative vendors.

Furthermore, this shift is not restricted only to thriving economies. In fact, businesses in developing markets stand to gain the most as we shift to decentralized supply chains. Why? Because companies, entrepreneurs and SMEs in developing markets will (finally) appear on the radars of motivated customers seeking to cooperate with promising new vendors. That interest will, in turn, create momentum and opportunities for investment capital, export-focused manufacturing, and growth in respective domestic markets

We anticipate that regions previously overlooked or underutilized may find renewed interest from the global business community as demand increases for greater diversity in suppliers. Central America is an example of a region that, thanks to proximity to larger neighbors and a young demographic workforce, may be well positioned to benefit from the shift.

SUSTAINABILITY

For our purposes, sustainability transcends movements solely focused on natural resources and climate change issues. Rather, there is a broader role to play for supply chains and sales channels as they adapt to physical and fiscal challenges.

We foresee business processes being influenced by marked demand for sustainability and accountability across all industrial sectors and market segments. This creates opportunities for forward thinking suppliers and sellers seeking to differentiate from their older, slower, less technologically developed competitors.

As previously noted, as supply chains decentralize, manufacturing operations will develop in a variety of regions and developing markets including Central Europe, Latin America, the Middle East, and North America. This process unlocks value for domestic economies, benefiting SMEs and micro businesses who add value through support services, such as banking and residential construction. In short, the interconnected, interdependent cycle of industry comes to fruition through decentralization.

Likewise, long-established sales and distribution channels will modify and establish new networks to remain competitive. A key takeaway is that professionals and companies that adapt in this shifting environment will be rewarded for using flexibility as a tactic. This applies to the complete supply chain and sales channel ecosystem, and supports our broader definition of sustainability in industry.

WHAT COMES NEXT

With this paradigm shift comes opportunities, particularly for those companies and individuals prepared for it.?

Without question, the connection between suppliers and sellers is inseparable. It always has been. And yet, the first step in business remains the hardest step in business: how to connect with the companies that want to work with you. Several companies are attempting to address that challenge.

Inrepco LLC is one such example. The Arlington, Virginia-based company applies innovative technology with industry insight to enable, simplify and promote opportunities for supply chains and sales channels worldwide. Described as a “dating app… for industry” the company’s AI-driven private platform automatically pairs supply chains and sales channels.?

One extension of Inrepco's platform is the SPED? (Smart Partnership for Economic Development) program. For nonprofits, NGOs, government agencies and trade associations, this initiative boosts economic development program results for emerging industries, SMEs and entrepreneurs. From remote towns to Tier 1 cities, SPED? ensures that no company need be left behind in the emerging shift impacting suppliers and sellers.

For more information, email the author at [email protected] or visit www.inREPco.com to learn more about Inrepco LLC.