When It Comes to Business Growth, More Isn’t Always Better

Manufacturing companies looking to grow and scale their operations often face a number of hurdles. Real estate and infrastructure investments can be costly, not to mention the additional staff, resources, insurance and other costs that make it hard to expand without taking on a hefty financial burden in the short term.

Fortunately, it is possible to grow and scale without physical expansion. By optimizing and using the right systems, strategies and partners, companies can continue to grow their operations and production without the added overhead and strain of a physical expansion.

Three Key Growth Strategies

Focusing on three strategic areas can help organizations make the most of their current footprint while maximizing their production and operational capabilities.

1. Digitization and automation: Much emphasis has been placed on the importance of digitization, technology and automation, but with so many options and capabilities available, it can be difficult to know where to begin. The key is to start small and identify areas that involve a great deal of manual output or storage but may be prone to human error. For example, transitioning to a cloud-based solution for inventory management may make it easier to ensure accuracy and visibility across stakeholders, and automating back-office processes to reduce manual workload can help avoid the need to add headcount or space for more people.
2. Rethink inventory and fulfillment: Managing inventory and fulfillment requires a high level of accuracy, especially for companies utilizing just-in-time inventory models. For companies looking to expand their manufacturing and production efforts without physically growing their footprint, finding new ways to optimize existing storage can help make the most of the space currently available. Additionally, outsourcing warehousing, distribution and fulfillment to an experienced service provider can help to avoid the need for extra real estate or infrastructure investments. Finding a partner whose systems can directly integrate with your own can also ensure visibility across all key stakeholders.
3. Create a strategic distribution plan: For companies that distribute only to certain regions, a centralized distribution strategy may be sufficient. However, for those with a more broadly dispersed audience, identifying a handful of strategic warehousing locations that can quickly reach the bulk of your customer base can reduce transportation costs and delivery times while improving customer satisfaction.

Scaling With the Help of a 3PL

Relying on an experienced 3PL partner for warehousing, fulfillment, distribution, reverse logistics and more can help remove the headache that comes with expanding operations while still giving companies the flexibility to grow and scale their business. A few of the benefits of outsourcing these services include:

• No need for additional real estate or resources: Companies can achieve the flexibility to grow and scale up or down by partnering with a trusted 3PL that offers warehousing, distribution and fulfillment services in their area(s) of choice. This eliminates the need to hire additional staff, purchase real estate and invest in new technology, among numerous other expenses while reducing overhead from the cost to own or lease space.
• Flexibility to accommodate demand shifts: Peak season and other events can contribute to fluctuations in demand, making it difficult to pivot quickly to accommodate rapid spikes or declines. Working with a flexible partner who can provide both the ability to forecast demand and agility to shift as needed can help companies continue moving forward without missing a beat.
• Faster, more affordable shipping: Utilizing a partner with an expansive network gives companies the ability to optimize warehousing and fulfillment operations in locations that are strategically located near areas with high concentrations of customers. Doing so allows for fast and more affordable shipping by keeping inventory closer to customers, in addition to higher customer satisfaction levels.
• Freedom to focus on what you do best: The logistics involved in growing and scaling a business can be overwhelming, even for experienced teams. The time and bandwidth required to create successful supply chain operations and pivot when plans don’t go as expected draws teams away from focusing on what’s most important to the business. With a flexible, scalable partner, teams have the ability to remain centered on growth and leave logistics to the pros.

Scaling Smarter: A Case Study

When the pandemic created a spike in demand for a global food packaging leader, they needed to quickly ramp up production and inventory to meet demand for their products, but they didn’t have the space available to store raw materials and finished product before distributing them to their customers. The company turned to NXTPoint Logistics to create a custom solution that would allow them to meet changes in demand and increase shipment velocity. To be successful, the company required 80,000 square feet of storage space for 5,500 rolls of raw materials, 6,200 pallet positions for finished goods, on-time shipments of 300 truckloads of product per month (in/out), 24-hour dock-to-stock turnarounds to ensure on-time shipments and complete visibility — all while ensuring that specific KPIs were met along the way.

Through a tailored approach that allowed for direct integration of NXTPoint’s WMS with the client’s technology, NXTPoint was able to meet all of the client’s KPIs while allowing them to expand their business without growing their physical footprint. As a result, what began as a yearlong project became an ongoing partnership that continues to grow. According to the customer, “NXTPoint Logistics has provided the best inventory visibility and physical inventory management capabilities that we have experienced with any partner.” Click here to read the full case study.

People Powered. Customer Driven.

This customer is proof that companies don’t need more space in order to be able to grow quickly. The key lies in strategic planning and working with the right partner to execute. With 35+ owned locations and 250+ partner locations throughout the country, NXTPoint works with companies every day to create flexible supply chain solutions that allow them to scale faster and with less risk — allowing them to focus on what truly matter to the business.

To learn how NXTPoint can help to grow and scale your business, reach out to our experts today and see how a custom solution could transform your supply chain.