It’s not uncommon to see building service contractors and in-house cleaning managers juggling the procurement of products, tools and equipment from multiple suppliers and multiple locations.
This not only is harder to manage; it’s more expensive, time-consuming and unsustainable.
There is a growing trend in the cleaning industry among organizations — especially those that pursue certification through ISSA’s Cleaning Industry Management Standard (CIMS) — to focus on better managing their supply chains.
As outlined in section 2.2.6 of the Standard, Financial Controls, it’s important for organizations to review such supply chain processes as supplier lists, purchasing, inventory management and more to find opportunities to increase operational efficiencies, reduce costs and environmental impact and drive consistency.
To help others join this movement and reap the benefits, I’d like to share the basics of supply chain management as it relates to cleaning organizations.
What Is The Supply Chain?
The supply chain consists of suppliers, manufacturing centers, warehouses, distribution centers and retail stores.
It includes raw materials, inventory and finished products and how they flow from one facility to another.
What Is Supply Chain Management?
Simply put, supply chain management is the oversight of the movement of the chain of supplies.
Effective supply chain management requires the integration of suppliers, manufacturers, warehouses and stores to ensure products are produced and distributed at the right quantities to the right locations at the right time to minimize costs while meeting service level requirements.
Rather than focusing on one aspect of the supply chain, it is best to take a systems approach by considering all aspects of the supply chain cleaning organizations must manage, including suppliers, purchasing processes, products and inventory.
Streamlining these processes results in operational efficiencies, including cost savings and increased sustainability.
Suppliers
When it comes to choosing suppliers, less is more.
Cleaning organizations can streamline the procurement process by first taking a look at their supplier lists and consolidating purchases with fewer suppliers.
Some organizations might use just one large, holistic supplier, getting everything they need from a one-stop shop.
This reduces the complexity of supplier management and allows for cleaning organizations to save on transportation costs and the environmental impact of transporting products and supplies from multiple locations through many separate transactions.
Purchasing Processes
With fewer suppliers, cleaning organizations can purchase what they need with fewer transactions, making for an easier purchasing process, delivery and reporting.
It also allows for cleaning organizations to save on product costs through product bundling and fewer invoices.
Product Standardization
A smaller supplier base and centralized purchasing enables cleaning organizations to create and maintain consistency in using the same product manufacturers and price structure regardless of location.
This product standardization not only reduces costs; it results in easier management of MSDS and smoother training processes.
Additionally, the product standardization process is a perfect time to review green purchasing guidelines and ensure products comply with the organization’s green cleaning program.
Inventory Management
Afraid of being caught short, it’s easy to spend too much on products and overstock your inventory.
Moreover, inventory that sits on a shelf is subject to damage, depreciation and even obsolescence.
With fewer suppliers and products to manage, along with a centralized purchasing process, cleaning organizations will have a better handle on inventory management.
When in doubt, organizations should evaluate order history and inventory control sheets to see how well they are doing.
Suppliers can also help by providing cleaning organizations with access to inventory management and supply control systems to help keep the right amount of cleaning products and supplies in stock.
The Payoff: Beyond Cost Savings
Optimizing the supply chain presents many opportunities to save money.
By reducing the number of suppliers and products, and streamlining purchasing and inventory management, cleaning organizations will see cost savings through fewer transactions, bundling discounts, a consistent price structure and well-managed inventory.
In addition to a better bottom line, supply chain management can also help cleaning organizations meet their sustainability goals.
No longer buying from multiple suppliers and locations, cleaning organizations that focus on fewer suppliers and transactions minimize the mileage required to ship products from many different places, resulting in a reduced carbon footprint.
Standardizing products and inventory also allows organizations to better manage a green cleaning program by creating specific guidelines for green product purchasing.
