The wind energy industry is facing some supply chain changes in order to prevent overstocking that resulted from shifting demand within the sector. A Consult Make report showed that strategic component supplies worldwide had overstock numbers from 50-90 percent in regards to global demand.
Ways to Combat Too Much Material
A Renews article showed how data collection software can help contain the overstocks and minimize mistakes of that magnitude. Of the stock excesses cited in the report, gearboxes came in at the 90th percentile, the highest number of the supplies that were shipped in excess. One of the reasons attributed to the overstocking was that the supply and demand gap has closed radically in the past 12 months, according to the report. Turbulent demand and several facility closures also contributed to the overall situation.
Overcapacity Trends Continue
The Consult Make report indicated that because of market exits and the aforementioned contributing factors, the industry supply chain is in serious need of re-vamping and soon. Opting for automated data collection goes a long way toward streamlining operations and preventing such drastic overstocking and cost overruns. Data collection software enables effective supply chain management and limits overcapacity. Keeping clean records of incoming and outgoing goods streamlines the process, according to the study.
Too Much Product Makes Prices Drop
As in any industry, if there is too much product available, prices drop. Having so many gearboxes in stock means that prospective wind turbine buyers aren't paying good prices, and industry analysts told Renews that the demand for turbines is down across the board. Because of all the backlogs of equipment and product, the Consult Make study suggested industry executives consolidate the supply chain. Identifying the problem areas and implementing inventory control measures can easily rectify the problems that have arisen along the line.
As many turbine manufacturers have several production facilities and multiple avenues of resources, keeping everything in motion and having all parts of the supply chain working at an optimum level is a critical job for management. Employing a data capture system can track every step of the supply chain and alert employees to any problem areas.
By being proactive, a smart company executive can eliminate problems like overstocking, which then offsets losses incurred and makes the bottom line more solid at the end of the fiscal year.