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News Release from: HAHT Commerce
Edited by the Manufacturingtalk Editorial
Team on 22 October 2002
UK manufacturing is difficult to do
business with
A recent research study on how UK manufacturers manage the demand manage the demand for their products from customers, shows communications are at fault.
HAHT Commerce, in conjunction with Vanson Bourne Research, have announced the results of a research study on how UK manufacturers manage the demand for their products from customers The results highlight barriers that customers and partners encounter when buying from leading manufacturers on a daily basis
This article was originally published on Manufacturingtalk on 6 Jan 2004 at 8.00am (UK)
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The research, titled The Demand IQ Survey, questioned Commercial Managers in 60 of the UK's largest manufacturing firms.
The responses show that, while manufacturers have invested heavily in improving their production and supply chain processes, sell-side 'demand' processes have been neglected, resulting in disenchanted customers: Poor communicators - 2 out of 3 companies are unable to integrate their ordering systems with their partners.
Lack of information - 75 per cent of the manufacturers surveyed were unable to provide automated inventory and delivery information to their customers.
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How Much Do they Owe? - 82 per cent surveyed were unable to provide sales teams with live customer account status, meaning bad debtors are still given red carpet treatment.
Poor Customer Service - 92 per cent were unable to initiate product returns through an automated system.
"In this economic climate, with overseas competitors snapping at your heels, being difficult to do business with is a crime," said Steve Ashurst, managing director, HAHT Commerce, UK.
"The research seems to show that far from a 'nation of shopkeepers', we are a lot more comfortable behind the scenes making things in the factory than working with customers to sell more." The survey, conducted in August 2002, suggests that chemical manufacturers are missing out on ways to improve their payment terms from customers.
85 per cent of respondents don1t have the ability to allow customers to print out their own orders, and only 5 per cent of those surveyed incentivised early payment online.
"Manufacturing can learn from other sectors," said Graham Opie, director of Vanson Bourne Research.
"It appears, on the demand side of the business, that a drastic shift in mind-set is needed here to transpose these traditionally old, inwardly focused firms into hi-tech, hi-value outfits.
This will give them the competitive edge they need in order to perform in today's fast paced service driven economy." Demand chains are increasingly complex, with products being distributed and sold through multiple channels, which makes true business intelligence more difficult.
The Demand IQ research found that despite the fact that three out of four companies sell products through channel distributors, only one in three can monitor sales status across these channels.
"In other manufacturing markets, such as the US, we have seen a big shift in focus from the supply chain to the demand chain as manufacturers realise that they cannot compete on price alone," added Steve Ashurst.
"To turn this around, they are now investing in the systems and processes that actually increase their revenue and reduce the cost of sale." "Demand chains are more ad hoc than supply chains," said Clive Longbottom, director of Quocirca Research.
"In many cases today's supply chain management systems have proved inflexible and costly, and have only been designed to cope with expected or planned transactions.
With the continuing move towards Web Services, we expect companies to recognise the need for more flexible solutions to manage these complex demand chains and look to deploy them quickly." The term 'supply chain' has been around for some time but the demand chain is less established.
In the same way that manufacturers were forced to innovate their manufacturing and supply chain processes to remain competitive throughout the nineties, the demand chain is now an area where margins can be improved and where attention is turning.
The demand chain reality for most manufacturers today is a complicated maze of disjointed and often manual processes for managing order, brand and product information, and customers services.
"Business success is about the balance of supply and demand but it appears that manufacturers only see half of that picture," concluded Steve Ashurst.
"By effectively managing your demand chain, you can turn spot buyers into strategic customers, reduce the cost of each sale or transaction, and become easier to do business with." The Demand IQ Survey, published by HAHT Commerce and the accompanying Improving Demand IQ is available today.
HAHT Commerce is also offering a free Demand IQ Assessment to UK manufacturers in order to benchmark their demand chain processes.
To arrange a Demand IQ Assessment please contact Cleone Robst at HAHT Commerce on +44 (0) 1483 246414.
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