Supply Chain Collaborations

They help businesses, using non-standard moves, earn money together with partners, in those niches where this cannot be done alone. At the same time, developed companies tend to collaborate when the efficiency of their own supply chains has already reached its maximum value.

Unfortunately, business in Russia most often uses a more closed model of cooperation. Therefore, today we can say that the process of collaboration is just beginning to be used in our country. The main impetus for merging is the exhaustion of their own internal potential for optimizing chains.

Such trends increase the level of competition in the market. Those companies that are able to predict and calculate their moves several steps ahead will be more efficient and, as a result, more successful.

The issue of implementing collaboration in supply chains today is one of the main ones for such developed markets as the markets of Europe, America and Asia. The development of interest in this form of cooperation is ensured by the interest of all parties to the transaction in obtaining greater profits and reducing costs. But in order to close the risks and ensure the legal side of the transaction, companies must use “reinforced concrete” agreements.

Collaboration cost reduction
Sharing the same resource by two or more companies allows for a more efficient approach to overhead costs. An excellent example of such a successful collaboration is the joint lease of terminal capacities. In this case, the terminal services for each participant of the collaboration will cost less than with an individual approach.

Group of business people assembling jigsaw puzzle and represent team support and help concept

The use of joint supply chains of goods allows you to remove redundant links, which minimizes unnecessary movements, removes intermediate storage and other “touches” of the goods.

Collaboration risks in supply chains
The main problem of such joint activities is the division of the received “buns”. In order to avoid disputable and conflict situations, it is best to prescribe in the contract in advance all options for dividing the benefits received from the implementation of a specific collaboration.

The second problem is the admission of a third-party company to information that is most often classified as a trade secret. In order for collaboration to be effective, trusting relationships between partner companies are necessary.