{"id":4298,"date":"2024-09-30T18:05:40","date_gmt":"2024-09-30T18:05:40","guid":{"rendered":"https:\/\/ejz.600.myftpupload.com\/?p=4298"},"modified":"2024-09-30T18:05:40","modified_gmt":"2024-09-30T18:05:40","slug":"capacity-planning-that-drives-growth","status":"publish","type":"avada_portfolio","link":"https:\/\/riverlogic.com\/es\/projects\/capacity-planning-that-drives-growth\/","title":{"rendered":"Capacity Planning That Drives Growth"},"content":{"rendered":"

Author:\u00a0Eric Uresti<\/a><\/em><\/p>\n

Capacity Planning is not just about cutting costs but also driving growth and ensuring supply chain resiliency.<\/strong><\/h2>\n

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According to a recent Gartner, Inc. survey (1), 73% of companies have added or removed production locations from their supply chain networks over the past two years. These shifts highlight the growing emphasis on building resilience, agility, and flexibility into supply chains\u2014moving away from traditional low-cost strategies.<\/p>\n

This new reality presents a significant challenge for supply chain leaders. Capacity planning is no longer just about meeting customer demand at the lowest possible cost or evaluating investment options. Today, it\u2019s also about\u00a0embedding resiliency into capacity planning decisions to create robust supply chain networks that can sustain corporate growth.<\/strong><\/p>\n

Leveraging River Logic\u2019s deep experience working with global manufacturing leaders, we\u2019ve identified three critical strategies for supply chain leaders to go beyond cost reduction and drive growth through optimal capacity planning:<\/p>\n

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  1. \n

    Develop Feasible and Optimal Plans Aligned with Corporate Goals<\/strong><\/h3>\n<\/li>\n<\/ol>\n

    Traditional capacity planning focuses on key decisions like shifts, sourcing, and inventory planning, but these alone are no longer sufficient. Supply chain leaders need to think outside the box by considering trade-offs and constraints unique to their business to build an optimal capacity plan. These include asset capacity, throughputs, finished or near-finished goods inventories, supplier contracts, and OPEX\/ CAPEX investments, among others.<\/p>\n

    The next step is to align the capacity plan with broader corporate goals, such as profit, margin improvement, growth, and sustainability. The most successful plans not only meet operational targets but also contribute to long-term strategic objectives.<\/p>\n

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    1. \n

      Balance Supply and Demand to Enhance Profitability<\/strong><\/h3>\n<\/li>\n<\/ol>\n

      One of the most complex challenges in capacity planning is balancing supply and demand to maximize profitability, not just to minimize the cost of goods sold (COGS). This requires a shift in focus from merely meeting demand at the lowest possible cost to meeting the\u00a0right<\/em>\u00a0demand that maximizes overall profit. Achieving this requires advanced analysis that includes:<\/p>\n