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Supply Chain Issues

Posted on: July 26th, 2022

During supply chain issues, an intimate knowledge of how money flows through your company becomes invaluable.  Knowing your choices and the impact of your decisions can mean the difference between survival and closing for good.

MLA helps small to mid-sized businesses understand their cash flow.  We can help you evaluate the impact of your decisions.  Contact us to learn more.

Challenges Getting Products

One MLA client is the exclusive US distributor for a particular type of specialty European sports equipment.  When Italy went through its COVID shutdown, production stopped, and existing stock quickly dried up.  A few years ago, this disruption would have put them out of business.  But now, because of an in-depth understanding of cash flow, and monthly cash forecasts, they were able to cut back on spending while maintaining their market presence and keeping staff employed.

This disruption forced the owners to reevaluate their business strategy.  Before COVID, MLA’s client drove most of its sales by attending national tournaments and events.  It was costly to have a physical presence, but the resulting sales more than justified the investment.  But with limited product to sell, and events being canceled, those sales were quickly going away.  Online sales allowed the company to replace that revenue.

“We saw the possibility of what the COVID shutdown could mean because we were in touch with the Italian manufacturers,” says Bob Lynch, an MLA Team Member serving as the Principal in Charge of this MLA client.  “So, when all the major events started to be canceled in the US, we had already shifted strategy.  Now, with rising fuel prices, this strategy is paying off even more.”

Overcoming Supply Chain Issues

With their investment in online sales, MLA’s client was able to immediately start selling when production returned and didn’t have to wait for large events to service the pent-up demand.  But this also required changes in how they ordered product.  “We started ordering much larger quantities than we ever had before,” Lynch remembers.  “We anticipated a surge in online sales when things opened up, and we wanted to make sure we had product on hand to satisfy that. Plus, this had the added benefit of allowing their supplier to place larger orders of raw materials which sometimes sped up delivery.”

This is just one example of how MLA has helped SMBs overcome supply chain issues.  Contact us to learn how we could help you.