Strategies for Industrial Manufacturers: Tackling Rising Supply Chain Costs and Boosting Profitability
In the competitive industrial manufacturing sector, managing supply chain costs is essential for sustaining profitability, especially as direct material expenses rise. To tackle these challenges, companies can adopt three primary strategies: enhancing procurement effectiveness, managing product complexity, and optimizing manufacturing efficiency. Improving procurement involves building strong supplier relationships, negotiating better terms, and leveraging digital tools to streamline sourcing and secure cost-effective materials. By focusing on total landed costs and reducing product complexity through standardized components and SKU rationalization, manufacturers can reduce expenses tied to inventory and production management.
Additionally, optimizing manufacturing efficiency by implementing lean principles, automating processes, and continuous improvement initiatives enables companies to reduce waste, increase throughput, and maximize resource utilization. These strategies help mitigate the impact of rising supply chain costs, positioning industrial manufacturers for sustainable growth and profitability amid a dynamic market.
About the Author
Ashim Talukder, Principal
Ashim is a Principal at Ducker Carlisle where he focuses on helping companies drive value in transactions and transformations through manufacturing and supply chain excellence, product development execution, and strategic sourcing. Ashim holds a bachelor’s degree in Mechanical Engineering from Osmania University, India; a master’s degree in Mechanical Engineering from University of Akron; and a MBA from Case Western University. He has more than 20 years of industry and consulting experience across industrial manufacturing, consumer products and chemicals industries with focus developing and executing operational innovations within culturally diverse environments to drive EBITDA, productivity, time to market, and quality. Ashim has authored multiple thought leadership articles for industrial clients related to Right Shoring Supply Chains, Relevance of Manufacturing & Supply Chain in Transactions, and Product Development Strategy & Efficiency.