Looking For The Next Frontier Of Margin Enhancement? Think Structurally!

Five key questions supply chain leaders must be able to answer to achieve the next tranche of margin enhancement

The pandemic forced many firms to rapidly expand and modify their supply chains. Capacity investments were made to meet surging demand and accommodate the inventory required to meet accelerated forecasts. Costs spiked in freight, labor, and raw materials. Price increases were used to offset inflation and increase margins. As demand normalized, firms executed opportunities to reduce supply-chain costs, but productivity gains became harder to capture. In a good illustration of this cycle, Macy's converted stores into mini-fulfillment centers in 2022 and is now downsizing and shifting to automation to cut costs.