March 5, 2014

Canadian business leaders putting supply chain strategy in forefront

MISSISSAUGA--Supply chain strategy has emerged from the shadows and is increasingly being recognized as a key pillar of growth and profit. More than 80 per cent of business leaders agree that a well-managed supply chain is a key competitive advantage in today's global economy. This insight comes at a time when consumers and businesses are increasingly demanding a more consistent experience across the multiple channels and jurisdictions. As a result, businesses are leveraging the power of a streamlined global supply chain in an effort to improve mobility, visibility and scalability.

According to a survey of Canadian businesses commissioned by UPS Canada and conducted by Leger Marketing, 80 per cent of businesses with a supply chain/shipping strategy met or exceeded their growth targets last year, whereas businesses without a defined strategy were 12 per cent less likely to reach their targets.

"These results indicate that businesses with a defined supply chain strategy perform better than those that don't and that businesses of all sizes can leverage this opportunity to increase competitiveness and profitability," said Jim Ramsay, vice-president of Global Freight Forwarding, UPS Canada. "Customers are demanding improved visibility, scalability and mobility — be it via ecommerce or commercial shipping — and the supply chain is essentially the nervous system that delivers the end experience in the most efficient, cost effective manner. High tech and well managed supply chains are a potential cash cow for business."

The survey also indicated that of those businesses with a defined strategy, 84 per cent agreed that understanding and effectively managing their supply chain and shipping operations were key factors in driving growth and profit opportunities in the last year.

"The results show that business leaders know the value of a streamlined global supply chain and are constantly looking for ways to more creatively and effectively manage inventory in a way that enhances the customer experience while reducing costs," adds Ramsay.

While the survey found that businesses of all sizes can benefit from having a defined supply chain strategy, small-to-medium sized businesses are less likely to integrate supply chain and shipping into their core business model. Nearly one-third of business leaders in this category suggested that supply chain and shipping is important, but that it is not a priority because their business is too small.

The survey found that 65 per cent of large businesses (i.e. those with annual supply chain expenditure in excess of $100,000 and annual revenue of more than $10 million) had a defined strategy in place. Mid-sized organizations (i.e. those with annual revenue of less than $10 million and more than 100 employees) were less likely to have a strategy in place (53 per cent). Organizations with fewer than 100 employees were the least likely to have a strategy in place 45 per cent).

Nearly half of businesses (46 per cent) with a defined strategy have considered leveraging services and expertise from a third party to assess and manage their supply chain/shipping operations. The benefit of third-party engagement is substantial as it allows any business, regardless of size, to advance their capacity to manage supply chain and logistics in a way that facilitates a high performance customer experience.

"This is an opportunity for businesses of all sizes to compete on a level-playing field – it is a powerful equalizer that allows small business to punch above their weight and large businesses to build market share," said Ramsay. "The real benefit of working with a partner like UPS is that businesses no longer have to waste precious resources on creating their own networks - they can simply tap into ours."

UPS is a global leader in logistics, offering a broad range of solutions including transporting packages and freight; facilitating international trade, and deploying advanced technology to more efficiently manage the world of business. Headquartered in Atlanta, UPS serves more than 220 countries and territories worldwide.



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