I’m frequently hearing from supply chain leaders who want to make a bigger financial impact on their businesses, but they’re constrained by limited resources. If you find yourself in this position, I recommend you take a look at your damaged shipment rates. You may be surprised by what you find.
There are few detractors from customer satisfaction that are worse than damaged shipments. The implications of damaged shipments are overwhelming:
- In a survey conducted by Dropoff, an overwhelming 79% of US consumers indicated that they would not purchase from the same company after receiving a damaged item.
- Replacing damaged products can cost companies 17 times as much as the original shipment.
- Most companies contend with damaged shipments as a regular occurrence in their supply chain operations, with an estimated 11% of all shipped units arriving at a distribution center with some level of damage.
Fortunately, it doesn’t have to be this way, and there are easy initiatives you can put in place to make an immediate impact. A supply chain services management platform like Elementum can aid companies in preventing damaged shipments to help them save money, time, and most importantly—their reputation with customers. By providing insight into the dynamics of a supply chain, Elementum’s platform allows companies to pinpoint exactly where the damage is occurring and make changes as necessary.
How Elementum Helps Minimize Damaged Shipments
Take, for instance, Elementum user McGee & Co.: an interior design firm and online furniture and homewares store in Utah. McGee & Co. used to rely on spreadsheets and emails to collaborate on their supply chain processes. But this system came with blind spots. If a shipment arrived damaged, they had no way of identifying the root cause of the incident nor did they have the ability to measure how frequently it was occurring.
McGee & Co. implemented Elementum to manage supply chain incidents, find out what caused them, then take action to resolve the issues. The platform’s actionable insights came very much in handy in the case of a freight carrier that was responsible for a 35% increase in the company’s damaged shipments. By using Elementum to connect to the customer experience team, McGee’s was able to identify the trend and take the proper steps for correcting it—which was, in this case, replacing the freight carrier with one more adept at handling luxury furniture items.
The switch was a crucial one. Not only did it reduce the percentage of damaged shipments to somewhere between 5 and 7 percent, but it restored their customer relations. Jessica Mecham, a claims and home delivery supervisor at McGee & Co., recalled how the damaged shipments impacted their brand identity. “These customers are even getting replacements that are also damaged,” she told the company’s supply chain leaders, “and this is essentially ruining our customers’ vision of what they expected.” Implementing Elementum allowed the company to make necessary changes for saving on both direct and indirect costs. It also allowed them to address incidents when they arose, enabling sustained improvements to their supply chain. Now, explained Mecham, “When we see trends in Elementum, like a particular item is getting damaged a lot, that essentially feeds our supply chain leaders and they are able to make adjustments.”
“When we see trends in Elementum, like a particular item is getting damaged a lot, that essentially feeds our supply chain leaders and they are able to make adjustments.”
Integrating Elementum’s supply chain service management platform to your company can save you the direct and indirect costs caused by damaged shipments. It will also provide your team with a tool for clear collaboration that improves internal workflow, streamlines your operations, and enables you to strategically manage and make improvements on your supply chain process. In order to experience Elementum firsthand, you can learn more or request a demo by going to www.elementum.com