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November / December 2020

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Perspectives

November 10, 2020
By Sharifa Parveen, BBA, MPA (CPA associate)

How has the pandemic changed your sourcing strategies and ability to manage market volatility?

Both the speed and scale of the coronavirus (COVID-19) pandemic have sent an unprecedented shock to the global economy. An analysis released by International Monetary Fund has shown that the global economy is expected to shrink by 4.9 percent in 2020. 

My company — a manufacturer and exporter of clothes in U.S. and Europe — experienced recanted sales orders. In addition, there has been an increased demand for environmentally friendly and sustainable products. Leading brands like Puma and H&M made a strategic shift towards a greener supply chain process. 

To mitigate volatility, we developed a joint business plan in which supply chain partners collaborated in planning and forecasting. As a manufacturer, we analyzed market data and conducted demand planning using the sales force composite method, while our buyers forecasted optimal business volume and offered replenishment planning to determine shipment requirements. 

The business plan included key sourcing destinations and suppliers with decades of experience in managing agile supply chain strategy. The forecasting techniques involved a combination of (1) deseasonalizing, (2) weighted moving averages, (3) exponential smoothing and (4) causal models.

In general, a critical factor in supply assurance is sound supplier relationship management. Long-term commitments, contracts and a rich supplier network are key indicators of supply chain proficiency and  efficiency, for reasons that include:

  • Lower production costs can be ensured by attaining economies of scale, and customers consequently will have lower material costs. 
  • Good supplier relationships offer potential for new business opportunities and seamless product development. 
  • A good relationship can inspire supplier negotiation concessions, like more beneficial payment, shipment and credit terms; faster lead times; and reorders on short notice. 
  • Stakeholders can facilitate knowledge sharing and critical problem solving. 
  • A good relationship often can rejuvenate or boost a company’s reputation among industry players and attract more financially solvent suppliers. A greater pool of suppliers helps ensure risk diversification to avoid product shortages.

All of these are critical to having the right supply at the right time and price.

 

About the Author

Sharifa Parveen, BBA, MPA (CPA associate)

Procurement manager
DBL Group

About the Author

Career advice I live by: 

1) It is of paramount importance to have an insatiable desire to learn and hone your knowledge, especially through international certifications and topical seminars. 

2) If work feels like play and you love it organically, you are in the right career.

3) If you strive for the best in what you do, the rest — including salary increases and promotions — will follow.

The biggest professional challenge I’ve overcome:

Challenge: In the current coronavirus era, the greatest professional challenge for retail supply chain personnel is to match the organization’s strengths and weaknesses with the changing dynamics of the industry and global policies.

What I did: Using a three-point strategy, I: 

  • Built a bullet-proof partnership with key suppliers
  • Stayed ahead of the race with well-informed industry awareness in a volatile fast-fashion world beginning to embrace sustainable trends
  • Developed an agile procurement plan.

Supply chain concerns that keep me up at night:

  • As oil will eventually run out, what will be the next fuel? And how will that impact the engineering of products and services that are heavily dependent on short lead time for import/export?
  • E-commerce is more prevalent than ever — and the number of online businesses is growing. We are harming the Earth with each layer of plastic used in the packaging and delivering of the parcels sent by e-commerce businesses. How can international policymakers work more closely to impede environmentally hazardous practices?

How I describe my job in one sentence:

I orchestrate key procurement strategies with people in various nations — China, India, Thailand, Malaysia, U.S. and European countries — to provide cost savings for my company.

Phrases I like:

Do it with passion, or not at all.

Work smart, not hard. 

“If I had asked people what they wanted, they would have said faster horses,” often attributed to Henry Ford.

A business-oriented book that has made an impact on my career:

Learning about Michael E. Porter’s Five Forces model and other models in his book, Competitive Strategy: Techniques for Analyzing Industries and Competitors, helped me to grasp overall techniques to analyze industries and the supply value chain.