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Cash Flow Optimisation Pt.2

Supply Chain Data flow eases the strain on your cash flow

You can't avoid problems you can't see. It seems obvious, but where do you look when you don't know where to look? One answer is in the data. Data travelling along your supply chain can reveal insight to predict choke points and keep cash flowing smoothly through the business.

Your supply chain does much more than simply carry products downstream, from your suppliers and through your business into the hands of customers. It's better to take a more holistic view of your supply chain and see it as a vehicle for meeting customer expectations, with products and cash flowing in opposite directions.

Look beneath the surface and you'll also find a wealth of data flowing in both directions. Extracting insight from this data reveals hidden twists and turns, helping you better understand your supply chain to ease the stresses and strains which impact cash flow.

That data can be drawn from a wide range of sources, both within your business and beyond. It ranges from transport and shipping data to inventory levels and customer demand. Individually, these data points might be of limited value but, viewed as a whole, they can tell a powerful story which provides actionable insight. For ideas on where to start, check out this article.

Perhaps you've already adopted automated replenishment, handing over the burden of simple, repetitive decision-making to an A.I system to free up your people to handle more important tasks (if you're thinking about it - look here). Automated replenishment is a powerful business tool, but it's really only scratching the surface in terms of AI's true potential.

Trained on your historical data, an AI-powered predictive model can also look ahead to anticipate trouble. Not only can it reveal the likelihood of any issue becoming a financial strain in the coming days, weeks or months, it can also recommend the best course of action to avoid trouble.

Once you can see trouble around the bend, avoiding it might be as simple as talking to suppliers or chasing transport companies to expedite things. Alternatively, you might shift stock between different locations, or consider alternative sourcing and shipping options. Or perhaps price reductions are in order, to get certain stock moving and free up cash flow.

Each of these decisions has its own costs and consequences, and this is where AI comes in and proves itself. It weighs up all the options to improve your decision-making and deliver the optimal outcomes based on your business objectives.

When AI has freed your people from the mundane day-to-day decisions, they can focus their efforts on solving the complex issues which have the biggest impact on your business. What these problems are will vary from business to business, but I’m sure there’s a litany of ideas in the back of your head under the label “Will get to when I have a spare second”. It's a textbook example of AI transforming jobs rather than eliminating them, and reducing supply chain strain along the way.

Of course, this all relies on detailed and reliable data flowing from every point of your supply chain. If one of your partners fails to do their part, it can muddy the waters. As such, we strongly recommend you assess your business systems and integration with supply chain partners to ensure a smooth flow of rich data.

The benefits flow both ways, and this is speaks to the power of Collaborative Supply Chain. In return for improved shipping data, you might offer your suppliers improved demand predictions to assist with their own business planning. Those demand predictions don't need to be a solid commitment from your business, just an estimate of what's likely around the bend. We've found that this helps businesses improve the amount of supply they can secure by up to 20 per cent!

Your supply chain is the river along which your cash flows, so it really pays to know when you're headed for a rough patch so you can navigate through it safely.


Want to know more about inventory management and replenishment? Head here to find out how AI can help you avoid stock-outs, or here to learn all about the things you need to consider before implementing AI. You can also see our platform in action via our case studies - including how we helped a wholesale distributor reduce stock-outs by 24%.Once you’ve had your fill of content from our blog, why not drop us a line here.


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