Will Asif Ali Gohar Expand Up or Down the Supply Chain
Some businesses find that by expanding up or down the supply chain, they are better able to maximize their returns and profits, while also ensuring smooth operations. This may include purchasing or developing delivery systems with the vehicles that are required. It may also include purchasing the land or farms that grow the raw materials, purchasing transport to get the raw materials to the factory, or other steps along the way.
Owning an increased section of the supply chain has several benefits. It increases the control over the scheduling, delivery speeds, supply levels, and more. By owning the suppliers or higher sections of the supply chain, a business can ensure that their orders are filled first and that they will not have a shortage of the materials that they need. When sections further down the supply chain are owned, the business can control the speed with which the finished product leaves the factory, how it is delivered, and the maintenance on the vehicles that perform that function. In some cases, a business will own the entire chain from their basic raw materials right to the store or location that the items are sold to the end customer. These are commonly seen in the farming industry, where the land and equipment are owned that are used to grow the fruit or vegetables. Harvesting is done by the owners of the farm and their employees, and by creating a small roadside stand or selling from trucks that are parked in the area, the entire supply chain is owned by that one farm. While these businesses may have increased control, they also have increased responsibility and that can come with more risk.
When asked if he plans to expand up or down the supply chain, Asif Ali Gohar shared that he may be expanding into some storage areas and trucks to deliver the final product. There are no set plans currently for expanding up the supply chain, though he is working closely with some suppliers and supporting small rice farmers in the area by purchasing from them. Supporting local businesses is one of the key components of the business plan, as it has several benefits for both the business as well as the community. By managing and owning the distribution section, he will be able to combine and reduce expenses while gaining improved control over when things are picked up and delivered, and where they are dropped off. It allows his team to ensure that orders can be filled before accepting them, and work out the delivery methods and time.
The supply chain is key in any manufacturing business and can make a business successful. While many use outside suppliers, delivery, transportation, and distribution, adding some of these aspects into the main business can improve profits and flexibility for the business. At this time, Asif Ali Gohar is not looking to expand up and down the supply chain, but the consideration of taking on some of it in the future is present.
