The global online economy is a huge game changer for both consumers and businesses, but not always in a good way. When auditing is performed well throughout the supply chain, everyone wins. When there’s a breakdown in this process, however, losers abound.
I love to browse on Amazon, not only to purchase things, but also to read reviews and determine which products people are happy or unhappy with before deciding on a purchase. It’s amazing how many times reviewers mention that the item described is different from what they actually received.
In this article we discuss how weak supply chain QC vastly increases costs and decreases customer satisfaction, but good auditing software solves this issue.
When Suppliers Determine Your Reputation and Costs
This idea is perfectly illustrated by a recent conversation we had with a major online retailer. Like many online retailers today, their warehouses are filled with products from various small suppliers around the globe. When their customers place an order, they in turn order the item from the supplier, rebrand it in their warehouse, and then ship it to the customer.
When this process is done well, it’s a win-win. In this case, that can’t really be said. According to the retailer we spoke with, 60% or more of their orders are returned due to customers receiving the wrong item. If they order blue shoes in a size 6, they may get red shoes in a size 10. Then the customer has to return the item, the retailer has to verify the problem and return it to the supplier, then wait for the correct item to be shipped back before they can fix the customer’s issue.
It doesn’t take a business degree to see how bad this situation is. Customers will often go elsewhere, and all of the shipping, receiving, and double-checking sends expenses through the roof. The sad part is that it’s all unnecessary. As they say, and ounce of prevention is worth a pound of cure.
Pre-emptive Measures for Success
To solve or prevent this merry-go-round of disasters, all that is needed is good auditing. Every supplier should be treated just as a direct employee in your own warehouse would be, and held to account.
The “ounce of prevention” necessary to avoid these headaches in the first place is a good auditing system that is not only used internally, but can also be extended to suppliers. When your suppliers are using the same software for auditing orders that your business is, the results can be seen instantly and incorrect orders can be prevented before the whole cycle of shipping-returning-receiving-shipping-again ever starts. And that equates to massive cost savings.
Compliance Checkpoint is built to be exactly this type of auditing system, with cloud-based software that is easily extended to wherever it’s needed – such as with your suppliers – by a simple download. The orders are then checked against the product specifications using the software, before they ever leave the supplier’s warehouse for yours, and can be stopped if they’re wrong.
It makes zero sense to operate otherwise, when a very minor investment up front begins preventative measures to stop the massive cost-bleeding immediately. Not to mention the customer satisfaction levels increasing, which will lead to repeat business instead of a loss of business.
