Managing a global supply chain can be immensely complex and even overwhelming. With rigid regulations and expectations, the potential for costly delays, disruptions, or legal issues is ever-present if you’re not prepared. Going global comes with unique risks to consider: from cultural implications to customs procedures that must abide by laws overseas. Businesses need an effective way to manage their foreign operations in order to ensure success; whether it’s tracking shipping information through various countries or negotiating favorable contracts across borders, efficient supply chain management is essential, as per Benjamin Gordon Cambridge Capital, when expanding into new markets worldwide.
Benjamin Gordon Cambridge Capital On Supply Chain Management: The Perils Of Going Global
According to Benjamin Gordon Cambridge Capital, global supply chain and Supply Chain Management are two important concepts that need to be considered when businesses decide to go global. The global supply chain is the entire process of producing goods from start to finish, including procurement, production, transportation, storage, distribution, and sales. Global supply chain management (SCM) is a business discipline that strives to create efficiency in this process by optimizing cost-effectiveness while ensuring quality control.
When considering whether or not a business should go global with its supply chain, there are several challenges they must consider as well. Global sourcing can be complicated due to varying regulations across different countries and regions. Furthermore, language barriers can present communication issues between suppliers and buyers. Additionally, cultural differences may make it difficult for buyers and suppliers to understand each other’s expectations. Global companies must also consider the costs associated with transportation, storage, and customs duties when creating a global supply chain.
The risks of going global in terms of supply chain management include both financial losses and damages to reputation. According to a survey of US businesses conducted by the Global Supply Chain Council, about 45% reported at least one incident resulting from poor risk management within their global supply chain over the past five years. Additionally, 80% of these businesses estimated an average total cost from such an incident between $50,000 – $500,000. One real-life example is the 2010 Toyota recall, in which several car models were recalled due to a faulty accelerator system that resulted in economic losses and reputational damage for the company. This serves as an example of how mistakes in a global supply chain can have serious consequences.
In order to minimize the risks associated with Global Supply Chain Management, businesses, as per Benjamin Gordon Cambridge Capital, must ensure that their suppliers meet international standards and are transparent about their processes. Companies should also carry out due diligence on each supplier to assess whether or not they will be able to provide quality products and services. Additionally, it is important for companies to put measures in place to avoid any potential issues, such as currency exchange rate fluctuations or political instability, which could disrupt production and delivery cycles.
Benjamin Gordon Cambridge Capital’s Concluding Thoughts
Global Supply Chain Management is a complex process, but it can bring many benefits if done correctly, says Benjamin Gordon Cambridge Capital. A properly managed Global Supply Chain can offer businesses cost-saving opportunities, access to new markets, and the ability to compete on a global scale. However, it is important that companies are aware of the potential risks and challenges associated with Global SCM before they commit to expanding their operations beyond local borders.