Dealing with Inflation and Supply Chain Demands

As business owners struggle to manage the highest inflation rates in decades, they are also struggling against worker shortages and supply chain disruption, which is hurting their businesses and consumers.

Inflation is not a new problem. Paired with supply chain disruptions, businesses must spread budgets thinly to survive month-to-month. Building sustainable processes will allow companies to maximize profits in a fluctuating market.

As an industry, there are a few different ways to adapt your business to today’s economy. Updating inefficient business processes, taking advantage of business opportunities, and having complete control over margins are three ways we have identified as effective fighters against inflation and supply chain disruptions.

Inefficient Business Processes:

When time is money and inflation is soaring, productivity needs to remain high. Additional costs can come when businesses are unaware of their utilization and productivity rates. Companies may be spending chunks of money on multiple systems that monitor their business but cannot integrate with one another. These costs can be easily minimized by switching to more efficient business management solutions.

Due to supply chain disruptions, materials are being shipped on an unpredictable timeline. Consumers can be wary of accurate shipping times and become annoyed when product shipping is delayed. The risk is not long a loss of future sales, but perhaps more harmful is the reputation.

Solution:

Switching to a cloud-based ERP solution connects all your business devices while cutting down on the workforce needed to run a typical on-premise business solution. Having machines that integrate and communicate with one another lessens errors, which in turn, reduces costs. To help offset the delay seen by supply chain disruptions, your company must communicate with buyers quickly. Using software that eliminates the back and forward communication could be what seals the deal with a customer impatiently waiting for another email.

Lost Opportunities for Sales:

Many customers will look to competitors if your business lacks an online buying option. Online shopping has been a consistent trend for years and has accelerated because of the pandemic. The market has become saturated, and businesses need to do everything they can to adapt to ecommerce changes before losing customers to competitors. Deliver an online experience that is modern and easy to use while also providing excellent customer service. Waiting for answers, going through bothersome payment processes, and questioning company credibility are reasons why customers may turn away from purchasing with your company.

Solution:

Creating an ecommerce space is necessary for modern business supply and furniture dealers. But creation is not enough. Your business’s website should become a competitive advantage rather than just a box that has been checked. Finding software that is easy to use and customizable to your company will help small-to-medium businesses (SMBs) curate the perfect shopper experience. After browsing, customers are turned to a company’s customer service in hopes of a quick and efficient checkout process. Solutions, such as Punchouts, are easy to ensure customers get timely responses. As your company builds its account portfolio, so will consumers’ trust.

No Control of Margins:

According to NFIB, 20% of SMBs assess their prices every few months. With prices fluctuating rapidly, it can be hard to manage margins competitively. It is essential to monitor competitor pricing closely while calculating your business costs. The combination of supply chain disruptions and inflation is causing an increase in prices, and while you may hold out, raising product and service prices will become inevitable or eat away at your bottom line. These increases create tighter profit margins, making it harder for dealers like you to reach their sustained profitability.

Solution:

Managing your margins can be done easily if you have the right tools in place. Margin management programs, like Margin Accelerator, help businesses quickly adjust pricing and margins so that they can maintain profitability and customer loyalty. Product pricing can be pulled from suppliers and dealers can create competitive, customer-specific pricing for every product and adjust quickly to reflect market conditions.

While some of these issues are temporary, they still do not show signs of lessening and will likely be recurring problems. Set your business up for success today, tomorrow, and in the future, no matter what complications may arise.