Standardised supplier labelling enables companies to reduce inventories, move goods more quickly through the warehouse and ultimately leads to a faster time-to-market and a more competitive and efficient business model.
The way that suppliers label their goods has major implications for the operations of many businesses. Take the aerospace industry for example, where the requirements for the parts used in aircraft are extremely stringent. Even when a supplier has been selected, their labelling methods can make it difficult for the manufacturer to adhere to traceability requirements.
The implications of this can be far-reaching for any business that relies on a supply chain. Dealing with multiple labelling standards can mean that warehouse staff need to spend time manually checking products themselves. This leads to increased stock turnaround times and possible missed production lines. This is not acceptable in a business landscape where reducing inventory and moving product quickly through the warehouse is key to remaining competitive.
These issues have been well recognised for many years and some manufacturers have even tried to mandate that their suppliers adopt a certain labelling process. However, this approach has not solved the problem. The reasons for resistance are numerous. Suppliers might have weak or non-existent IT infrastructures or feel overwhelmed at the thought of adopting all the labelling standards for their multiple customers.
But should businesses plough on regardless, or are their concerns justified? Of course, with traditional labelling solutions they are. But, on the other hand, with a modern, cloud based-based solution, many of these objections can be mitigated.
Standardising the supplier labelling process
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Würth, a global market leader in the sale of fastening and assembly materials, was a company which was struggling with many of the typical labelling challenges created by a legacy system. Their solution was custom-built and consisted of a locally installed database, label design software and a label print interface. Everything was updated manually which made it impossible to have an overview of which label software version Würth’s suppliers were using.
The business was receiving incorrectly labelled goods which meant products needed to be relabelled and shipments were delayed. They decided that they needed a centralised database which could be provided to their suppliers without the need for any IT installations or changes to their current printer models. To get suppliers on board, it was crucial that the new labelling system could use the suppliers existing printing infrastructure. And the best way to achieve all of this was through the cloud.
Benefits of cloud
Würth implemented a web-based, standardised solution which has been able to speed up their new supplier onboarding system and it ensures that users are always using the correct label version. Furthermore, because all the information is hosted in the cloud, it reduces any IT security concerns in terms of securing the business infrastructure.
In fact, using the cloud can make life easier and simpler for everyone in the supply chain by:
- Guaranteeing the same label output, regardless of the supplier’s printer brand or technology. It gives consistent, brand-compliant labelling, and suppliers get to keep their existing IT infrastructure
- Reducing the IT burden and security risks. With cloud-based supplier labelling, IT staff don’t have to spend time granting suppliers access to internal labelling infrastructure. This saves time and IT resources, and it protects systems and key data from unauthorised access. Suppliers always have access to the most updated version of the label template
- Preventing any IT burdens. All suppliers need is a username, a password and an Internet-enabled device
- Getting up and running quickly. The Cloud offers suppliers an instant deployment and quick onboarding process
- Using centralised management and record keeping. The business always has a complete overview of the suppliers accessing the system and a complete print history. The web based printing solution also ensures users are always using the correct version of the labelling solution.
Ongoing business efficiencies
Businesses looking to standardise their supplier labelling process need to look for solutions which have a built-in label designer, an application builder, a document management system for streamlined quality assurance, and built-in support for manual data entry and integrated label printing. As it is hosted in the cloud, it also reduces security concerns and IT effort in installing and securing access to the required infrastructure.
When supplier labelling is done well, businesses report real tangible benefits. For instance, a furniture manufacturing company was able to reduce the time to unload a truck by 44 per cent and increase turnover in the warehouse by 55 per cent, which enabled them to reduce inventories and move goods more quickly through the warehouse. This clearly leads to a faster time-to-market and a more competitive and efficient business model. Besides €1.65 million working capital savings from reduced inventory, they were also able to increase labelling compliance, leading to more consistent labels and improved supplier relationships.
Ken Moir, VP, NiceLabel