Companies in the supply chain must constantly have their ear to the ground when it comes to legislation that may seem small, but could have a drastic impact on the products the organizations offer. For example, The New York Times reports that legislatures in Albany, N.Y., are considering a bill that would outlaw the tiny plastic beads that are found in some facial scrubs and beauty products.
According to The Times, the beads collect in the Great Lakes in high concentrations and become coated in toxins. There is concern that the beads are then consumed by fish and the toxins could work their way back up the food supply chain. While New York would be the first state to ban the product, the group behind the push would like to see it implemented nationally. Some companies have already agreed to phase the beads out of production, but others could be caught off-guard if the bill quickly becomes law.
Manufacturers Must Respond Quickly to New Laws
When a significant ingredient in a product is legislated out of the supply chain, the impact could be disastrous to a company that cannot quickly prepare for the repercussions. While some companies have already found organic or otherwise acceptable replacements for the plastic beads, it can take time to find new suppliers and update equipment for the new ingredients.
Even with forecasting and models for the transition, it can be hard to predict exactly how introducing a new product into a company's supply chain will impact overall production. If the product is now organic, it could be susceptible to breakdown, requiring more accurate inventory control than before. There also may be fewer local suppliers available, requiring a company to extend the reach of its supply chain.
Advanced Data Collection Improves Success of Transition
To keep their products on the shelves, companies such as those impacted by the bead legislation will need to find new suppliers quickly. However, if they do not have time to properly vet the new suppliers beforehand, supply chain managers will need access to data collection tools that can keep them updated in real time on how the new supplier and techniques are impacting production. This information should also be integrated with existing ERP solutions for a better idea of the material change's impact on the bottom line and other business processes in the organization.