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Lack of supply chain innovation holding back business growth


With an average of only four per cent of Australian businesses improving their logistics, delivery or distribution methods, Australian businesses are mitigating their growth.
 
According to the Australian Bureau of Statistics’ 2008 Business Characteristics Survey, more than half of all businesses in wholesale trade, retail trade and manufacturing were ‘innovation-active’ but improvements to logistics, delivery and distribution methods were as low as five per cent in small businesses and only seven per cent in medium-sized businesses.
 
In terms of industries, wholesale trade led the way for improved logistics, delivery or distribution methods at only 12 per cent, which was double that of manufacturing.
 
According to Walter Lago, managing director of 3PL service provider Rizzi, these startling statistics offer an insight into some companies’ stalled growth.
 
“To grow in the competitive game of supplying commodities, many companies’ competitive edge rests with their logistics and the speed and quality with which they can deliver their product to their customers,” said Lago.
 
“Having streamlined, reliable storage and delivery management is imperative not only to growth, but to survival, and the fact that many organisations are not investing the necessary resources to improve their logistic capabilities is sheer recklessness.
 
“We need to get the message out to Australian companies about the fundamental importance of stock management and distribution and the severe negative impact that can have to their bottom-line should it go awry,” he said.
 

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