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invoicing tips

9 Invoicing Tips Small Business Owners Should Keep in Mind

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Some business never get the money they are owed. And yet, some seem to have no problem getting paid on time. What is their secret? A good invoicing system. Here are 9 invoicing tips that has helped countless small business owners and will help you maximize your cash flow as well.

1. First, Set Payment Terms

The first thing you should do before sending any invoice is to set exact payment terms with your customer. That will prevent any awkward situations to arise once the time to pay is at hand.

Consistency is the key here. If you can, send the client an estimate (in writing) to let him know how long the work will take and how much it will cost. Once the work is done, send the invoice. Of course, the invoice and the estimate won’t be exactly the same, but they shouldn’t differ by a too large margin. You don’t want to surprise the client with a cost you haven’t mentioned before.

2. Don’t Wait to Send an Invoice

Get into the habit of invoicing as soon as the work is complete. That way, your customer will have less chance to “forget” about you. Think about it. If someone does something nice for you, how long do you actually remember to “return the favor”? Those kinds of things unfortunately tend to slip from our minds pretty fast. Don’t let your work slip from the customer’s mind either.

3. Make Sure You’re Invoicing the Right Person

Let’s say your company provides content writing services for a big client. In that case, you’ll probably be working the most with the marketing department. Should you be sending your invoices to the head of Marketing? Probably not as he has other things to do (Marketing related, you know). Maybe your invoice gets buried under a ton of papers or maybe they don’t have the authority to sign at all. Be sure to ask who will be handling the invoices before you start sending them. That way, you won’t have to go back-and-forth with the client asking them when your invoice will be paid.

4. Number Every Invoice

Numbering invoices is a good way to easily refer to them at a later date and track payments. Most invoicing software will automatically number your invoices, so you should already be covered. However, here’s the trick. If you just started using an invoicing software, the numbering will naturally start with #001. That may not be such a good thing, since the clients may perceive you as lacking experience. To avoid this, start with a higher number.

5. Set Payment Terms that Best Suit Your Business

It’s best if you send invoices with an actual due payment date. That way, the customer will know by which date they need to pay and can act accordingly. “Payment upon receipt” doesn’t tell much. When did the customer receive it?

Also, you should probably refrain from the standard 30 day arrangement and instead use one that suit your business more. Maybe you’re in a fast-moving industry where you need to have a fast cash flow to keep your business running and 30 days is too much.

6. Don’t Forgive Late Payments

One of the biggest questions is what to do with customers who are late with payment? Sure, you can stop working with them, but if they are bringing you a nice business, why would you? Well, for those kinds of “forgetful” customers, you need to set an interest on late payments.

Make it crystal clear that you will charge the customer a late payment fee (an exact number, rather than a percentage) if they are late with payment.

7. Use an Invoicing Software

Gone are the days when you could type an invoice on a piece of paper and send it to the customer. And it’s a good thing they’re gone too, because using an invoice software makes things much easier for both you and your customer. There are plenty of professional invoicing tools out there, but so make sure to check this article to find the Top 5 Invoicing Software for Small Businesses and Startups.

8. Get Someone to Help with Invoices

When you’re just starting a new business, you’ll probably be doing the invoicing yourself. But as your business hopefully grows and more customers keep coming, there will naturally be other things to keep you busy. In that situation, it get very easy to screw up on the paperwork, send an invoice to the wrong client or just not have the time to play debt collector (and trust me, you’ll have to do it once in a while). Or maybe you’re just not the sort of person to ask people for their money. Whatever may be the case, hire someone, either in-house or remote to handle your invoices for you.

9. Remain in Communication with Customers After They Pay the Invoice

This is one thing that many business owners forget to do and it is costing them a lot of future business. You shouldn’t end the communication with the customer immediately once you get paid. The least you can do is send them a thank you note, letting them know you appreciate doing business with them. You’ll be surprised how much this means to people and how much repeat business it will net you.


There you go. 9 invoicing tips every small business owner should keep in mind if they want a healthy cash flow and a good rapport with customers. If you know of any other invoicing tips, please share them with us in the comments below and don’t forget to sign up for a free Purchase Order Plus trial.

Top 6 sales forecasting mistakes

6 Most Common Sales Forecasting Mistakes (+ How to Avoid Them)

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It would be really nice if you could nail your forecasts 100% of the time. Unfortunately, that’s just not possible. Every sales cycle offers a different challenge, and while you can predict some things based on the previous cycle, sometimes things don’t work out the way you thought they would. In this article, we’ll go over 6 most common sales forecasting mistakes your business can make as well as what you can do to avoid them.

1. You’re “Assuming” Your Forecasts

Look, sales forecasting is not a precise science. It’s a bit like cooking in that you do it “per taste”. But just like in cooking, there are certain rules you can get over. That’s why you shouldn’t base your forecasts on just assumptions or “gut feeling”.

Today, companies that take a careful look at data from past performance out-perform those that rely on intuition, so be sure you place yourself in this first group. If nothing else, data can give you a good idea of what went wrong, while instincts are not that measurable.

2. You are Not Responding to Market Changes

Now, every market is different and presents its own challenges, but by and large, you should always be prepared to respond to changing market conditions. Of course, this implies that you already have a good grasp on your particular market, or a “finger on its pulse”. This will allow you to respond fast, but not rush headlong into a costly mistake (understanding market risks is huge when it comes to sales).

3. Not Knowing What the Customers Want

If there is one source that your sales forecasts should look upon above all else, it’s your customers. You want to be in constant touch with them to know what they are thinking, especially about your own product. And I don’t mean some metaphorical touch, but actual contact with customers. Don’t separate yourself from your prospects, talk to them, meet them face to face, on the phone, on email or chatbot and find what their opinion really is, rather than guessing it.

4. Not Understanding all of the Market Factors Responsible for Creating Adoption for Your Product

If you think all you need for the market to adopt and accept your particular product are good quality, low cost and ads, you’re sorely mistaken. There are many more factors that will create (or prevent) the adoption of your product and it’s up to you to figure them out. Now, you may not be able to do this exactly the first time you try, but if you’re paying attention, you’ll be able to predict these factors and even use them to your advantage in your future sales cycles.

5. You are Using Wrong Product Timing Info

If you have too many people raising a child, than that child won’t receive the best care. Think about your product as a child as well. Especially in the introduction phase, everybody from the product manager, to engineering, to the executives in the upper management, will have something to say about how to “raise the child”. Some will want to get it out too quickly, some will look for unnecessary features and so on.

One of the worst things for your forecasts is working with unreliable product timing information. The upper management will often be on your neck to get the product out now, unaware of all the factors why this shouldn’t happen. It’s up to the product manager to tell them to take a breath, because otherwise, your forecast will be wrong.

6. Not Learning from Past Forecasts

A lot about sales forecasting revolves around learning from your past mistakes. Forecasts from the past sales cycles play a big role here, so make sure you learn as much from them as you can. In particular, you want to measure the right metrics and not those that make you appear in good light when presenting your results to the upper management.


Forecasting may not be exact science, it involves some trial and error, but if you manage to avoid these six sales forecasting mistakes listed in this article, your business will be on the right track for the future.

Know of any other sales forecasting mistakes that we forgot to mention? Let me know in the comments below and don’t forget to sign up for a free Purchase Order Plus trial today.

supply chain disruptions

7 Most Dangerous Supply Chain Disruptions You’ll be Faced with

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Once you get your company on the right path and it starts to grow, almost inevitably so does the supply chain grow. However, with a bigger supply chain also comes a myriad of problems. In this article I’ll go over the 7 most common (and probably most dangerous) supply chain disruptions that you are likely to face. Hopefully, this will allow you to be more ready for them.

1. Your own Workforce

For a supply chain disruptions to appear, you don’t have to look much further than your own workforce. In fact, labor itself is the single biggest variable cost (meaning one that varies with the level of output) within a warehouse. Even a slight increase in wages can send your product price to the roof and I don’t think I need to even explain the consequences of things like work stoppage and a strike. Those will grind your supply chain and entire production to a screeching halt.

2. Wrong Forecasts

Never expect tomorrow to be like today is. If you plan your future demand based on what your past demand was, you may very likely end up with excess or short stock and neither is a good idea. The global supply chain is much too complex to be looked at this way, but this can be mitigated by a move towards a digitized supply chain that uses advanced analytics and future-oriented forecasts.

3. Legislative

This is especially important for companies doing business internationally, but even just on the US soil, you’ll often encounter vast differences in legislation and compliance from one state to another. For example, Florida has different medical waste regulations than Michigan and Michigan has different than Washington. Not knowing these and not preparing for them can be a big roadblock in your supply chain.

4. Price Fluctuations

Price fluctuation can often lead to higher production cost and this in turn ups the risk of losing customers. This is especially prevalent in companies that make their decisions in an information silo, an information management system that is separate and doesn’t communicate with other information management systems.

5. Cyber Threats

Cyber threats are a relatively new breed of supply chain disruptions, but they are getting bigger and bigger. More and more companies are getting hacked and this causes them to lose reputation. Customers increasingly do business with you online and expect their transaction to proceed smoothly. What a lot of companies don’t realize is that most cyber security threats come not from the outside like hackers, but from the inside. That is why educating your employees on this is crucial, if for nothing else than to know which email attachments are safe to download and which aren’t.

6. War, Political Unrest

Political unrest and war are pretty obvious supply chain disruptions. In fact, they are disruptions to normal life, period. Take for instance, the war in Ukraine, which led most airlines to change their flight routes. Because of this, airlines had to change their schedules, recalculate how much fuel they need and change crew hours.

7. Nature

Of all the supply chain disruptions, those made by nature are the most unpredictable and often most destructive. Whether its a flood that forces you to change your transport route, an earthquake destroying a factory, a hurricane or something else, nature can stop your production in the blink of an eye.


Can you prevent these supply chain disruptions? With the exception of your labor as a disruption (and even that is on a long rope) and making better forecasts, no. But you can prepare for them and that way make more qualified decisions for when they happen.

If you have any questions, let me know in the comments below and don’t forget to sign up for early access to Purchase Order Plus software for free.

Forecasting tips

9 Forecasting Tips That will Improve Your Business

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Forecasting should be one of the key elements of your business strategy. Without it, you won’t be able to make accurate marketing plans and make informed decisions about the future of your company. However, it is far too easy to make an inaccurate forecast and this can be even worse than not having one. So, to help you make the right forecasts, here are 9 forecasting tips that will improve your business if you follow them.

1. If You Don’t Measure it, You can’t Improve it

What isn’t measured can’t be improved. Let this always be your mantra when thinking about forecasting. Make sure to choose your most important KPIs (key performance indicators) and keep measuring them if you want to improve them. Without measuring something, you won’t even know if it is broken and needs fixing.

2. Don’t Forget to Keep Accurate Records

Forecasting and demand planning relies on having accurate records in the first place. Without this you can safely throw the forecast into the bin. So before you go with it, make sure the records represent the real situation, no matter how dire it seems.

Speaking of records, you should also make use of historical data, because very often, they’ll provide a glimpse into the near future. Perhaps you’re having more business in September and less in April? Always keep an eye on market and industry trends.

3. Assign Owners

For each process, you should assign an owner and make it clear what your expectations from them are. Typically, this can be the manager of that particular sector, which makes the most sense as they’ll be the person with the most authority, but you can assign someone below them in rank as well.The important thing here is to keep watch if they’re doing the right job.

4. Always Keep an Eye on the Competition

Never take your eyes of your competitors. No matter what business, industry or market you are in or how small the niche is, there will always be someone competing with you whether directly or indirectly. You don’t have to (nor should you) simply copy them verbatim, but neither should you allow them to slip away from you. For example, has the competitor opened a new store near one of yours? That can be a problem and therefore you should address it in your next forecast.

5. Get Rid of the Spreadsheets

If you’re still using spreadsheets, here’s a great forecasting tip for you. Get rid of those. Find a good forecasting and demand planning platform instead. This will make your life a lot easier and your forecasts much more accurate. Make sure that the platform includes custom workflows and enables both multiplan and multi-team collaboration.

6. Break Down the Forecasts by Segments

You should first create a basic forecasts using the historical data that you have. From there, it’s a good idea to segment that forecast into different parts. This will obviously look different for various industries, so think about what works best for yours. In the end, segmenting will allow you to have a better picture of where your business as a whole is as well as where these different segments are at the moment and where you can improve them both.

7. Educate

If people in your organization don’t fully understand what a forecast is and why you are doing it, don’t expect it to go well. Everybody involved should be on the same page when it comes to forecasting, so make sure you educate those involved to know what forecasting is and what it is not.

8. Don’t Rely on Yearly Forecasts

Most companies that even do forecasts, do them once a year. That may work for some industries and markets, but most move much faster than that. The more regular your forecasts are, the better the results that you get will be. You don’t have to create a forecast every week, but make sure to do it at least for every quarter, even monthly if that’s what your business requires.

9. Be Ready for Mistakes

With forecasts, you want them to be as accurate as possible. You’ll rarely get a 100% accurate forecast, largely because it is hard to fully understand the insight of your different teams and then put them all into one package. Somewhere, somehow, something will get lost. Don’t dwell on it too much. It’s better to have a 75-80% accurate forecast than no forecast at all.


Of course, there is a lot more than that to creating forecasts that will help your business, but hopefully these 9 forecasting tips will get you on the right track.

If you have any comments or questions, let us know just below the article and don’t forget to sign up for a free Purchase Order Plus trial and get your POs in order.

forecasting fpr small business

What is Sales Forecasting and How Does it Affect Small Business

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If you own a small business, success will not come to you if you only wait for it. Instead, you need to go toward it. This is why it’s crucial if you’re a small business owner (or any size business owner for that matter) to predict the future and know where your company is heading. But how do you predict the future without a fancy crystal ball? That’s the domain of sales or demand forecasting and I’m going to explain what it is all about in this article.

What is Sales Forecasting?

There are several definitions of sales forecasting, but I like the one from Hatchbuck so I’ll borrow it to help you better understand it:

A sales forecast allows you to determine what your estimated sales (Revenue, New Customers, etc.) will be for a given time period. The forecast is generated from an analysis of previous data about your sales, the sale of similar products by your competitors, and market response to your offerings.

There are basically two types of forecasting, depending on how long it takes:

  • Short term forecasts are for a period of 1 year. These types of forecasts are mainly used to make certain tactical decisions and focus on seasonal cycles and growth patterns.
  • Long term forecasts are for longer periods, of more than a year. These are necessary for establishing the company’s long term vision and setting up new locations and business units.

What Steps You Need to Take in Forecasting?

Forecasting sales demand should never be done ad hoc. The wrong forecast will easily lead you to the wrong conclusions. It’s best to avoid it, naturally.

Here are 4 steps that you need to take in forecasting your demand:

  1. Appraise your past sales

“You have to know the past to understand the future”, as Carl Sagan once said. If you don’t know your old sales and haven’t learned from them, how do you expect to improve your future sales?

For an already established product, look at your previous sales, going back 3-4 months or even more if possible. Evaluate every part of those sales, including monthly sales, sales rep, distribution and price. The more data you have, the better. However, even if you only have one location, one product and one sales month, you can still earn a lot from this.

  1. Talk with your sales reps and retailers

Who knows the sales better than those directly involved such as sales reps and retailers. Their input will be extremely valuable in forecasting future sales. Get them in the room and let them tell you their insights from talking with customers. You might not even realize that you’re using a wrong distribution channel or have set your prices too high. But if you have sales reps that keep their ear on the ground, you can learn this sooner and correct accordingly.

  1. Pay attention to industry trends

Forecasting can’t be done in a vacuum. If you don’t follow up with your industry’s trend, you risk  being left behind. Websites of your industry’s trade associations are the first step you need to take to learn about the latest trends, new competition, whether a competitor has left the market, new competing products and services and more.

Industries and markets change all the time. If you are not paying attention, others do and will have a head start.

  1. Forecast

Once you’ve evaluated your past sales, had a face-to-face meeting with sales reps and retailers and have picked up on the latest trends in your industry, there’s only one thing left to do. Create your forecasts.

Typically, you want to create as many forecasts as you can, but you should create at least five. One for each quarter and one extra for the next year. You should also create forecasts based on your current price point. Create one lower and one higher as well as best-guess scenario that you get from analyzing your current performance.

Finally, create one optimistic and one pessimistic forecasting scenario, but in the end, stay realistic with your forecasts.


Don’t expect success if you don’t accurately forecast. Forecasting can help you learn what mistakes you’ve made in the past and how to move in the future. This makes it crucial for any small business.

And speaking of things t important for a properly functioning business, you need to make sure your purchase orders are always in order. This is where our Purchase Order Plus add on software for Xero can help. If you are looking for a way to easily create, approve and send POs on any device, sign up for a free trial of Purchase Order Plus.

components of supply chain management

6 Must-Have Components of Supply Chain Management

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There are two things that your supply chain needs in order to be effective. First, it should be able to deliver results on time , second, it should be cost-effective. How do you accomplish those two? Well, depending on your business and industry, it could be more or less difficult, but you always need to make sure that the following 6 components of supply chain management are working for you.

1. Planning

Planning, as it relates to SCM isn’t just about sitting down and thinking “this is what we’re going to do”. Yes, there’s that as well, but much more beside. Planning is not just one activity, it’s a whole specter of them and it starts with the decision whether to manufacture the components yourself or to buy them from a supplier. This decision needs to be weighed carefully.

But even when you opt for one or the other, there are still nuances for each choice. Will you manufacture domestically or internationally? Buy from a domestic or international supplier? Make goods to stock or to order?

2. Sourcing

You know what the worst kind of plan is? The one that is never executed. Even completely bad plans are better than that. So the next component of supply chain management that you need to take care of is sourcing.

This means identifying, evaluating and bringing suppliers that will provide you with goods and services and it depends heavily on your business needs. This is why you should carefully evaluate your material, service and financial requirements before before you even attempt to reach potential suppliers and start a formal bidding process.

3. Demand and Inventory

No SCM can survive without a well-maintained inventory. You need to have items, components, raw materials and such always at the ready if you are to deliver products on time. Without a proper inventory, you won’t be able to manufacture, let alone sell your products.

Your inventory will first and foremost depend on the actual demand. If the demand is high, your inventory should be high as well, if it is low, cut the inventory. How do you bring the two together? By bringing in demand planning at the early stages of your product development process. Accurate forecasting is the key here.

4. Production

There’s not much  to say about this element of SCM that you already don’t know. At the end of the day, if you don’t produce something, you can’t sell it. It’s simple as that. In a way, this is the central component of supply chain management. Everything before leads directly to it and everything following picks up after it.

5. Warehouse and Transportation

Warehousing and transportation are another two important components of supply chain management. First, you need somewhere to store your product, which is where the warehouse comes in and y second, you need to be able to transport and deliver goods from point A to point B or from your manufacturing centre or warehouse to the store and the customer.

We already touched a bit on the warehouse part when we talked about inventory, so let’s turn our attention for a moment to transportation instead. On time transportation is incredible important for an uninterrupted business process, but beside fast, it should also be safe. The customer wants to get his order in one piece after all.

6. Return of Goods

The three words that no business owner wants to hear is “return of goods”. Yet sometimes you can’t escape from them. Well, since it’s like that, why not make what seems like a defeat in something that can work for you and at least increase your reputation with the customers?

Not all of your products will be in pristine condition and some may, for one reason or other, reach the buyer in a defective state. Of course, they will want to return those. Unfortunately, I’ve seen plenty of companies that make return of their goods a complete nightmarish process. That’s not how you should do things. How do you think the customer will feel when they not only receive damaged goods, but now they can’t return them either?

Admit your mistake, apologize for the inconvenience and accept the return.  Of course, you should have clear rules for what can be returned and what not and how your returned goods should be managed.


There you have it. With these six components of supply chain management, you will be able to accomplish those two main task of an SCM that we talked about at the beginning of this article – deliver results on time and be cost-effective.

Do you have any thoughts or questions about this? Let me know in the comments below and don’t forget to sign up for free for Purchase Order Plus.

Logistics management tips for SMBs

6 Important Logistics Management Tips for Small Business Owners

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It may start like a dream, but to many business owners, it can quickly turn into a nightmare. Despite what they say, there is more to it than “hustling” and working long hours. If you want your business to succeed and to sell your product, you need to pay attention to a lot of things. One of them is certainly logistics. Here are 6 logistics management tips that will help your small business thrive and keep your customers happy.

1. Set Your Objectives

Okay, this one is easy, right? The objective of logistics is to move the product from point A to point B. Easy. Except there is more to it. Your logistics objectives first need to align perfectly with your business objectives. Second, you need to determine what is your primary target. Do you want to have cheap delivery or fast delivery?

If you are going for cheap delivery, you will probably have to find some non-essentials that you can remove from the equation. On the other hand, if you’re aiming to provide fast delivery, then your transportation and shipping costs are likely to increase. In the end, you need to find that perfect balance between these two and find out what the customer wants.

2. What’s the Plan?

Once you know what your logistics objectives are and they are aligned with your business and marketing objectives, it’s time to work out a plan. Now, keep in mind that you can’t plan only based on your expectations. That will be just one thing that you will need to look at, but there will be different areas that will demand your attention as well.

You should have a plan for full shipping ready in advance, of course, but also don’t rely on just one plan as it might easily fail you. Always set up contingency plans in case things don’t work out as you intended. For instance, if there are delays, the truck breaks down or has to take another route to reach the customer.

3. Keep an Eye on the Costs

Former Secretary of Treasury of Great Britain, William Lowndes (1652-1724) once said: “Watch the pence and the pounds will take care of themselves”. The quote was latter attributed to Benjamin Franklin (falsely), but whoever first said it was right to the point.

You should know how much each element of the logistic process costs you, and not just focus on the major ones like shipping or packaging. That way, when you know where each dollar, euro or pound is going, it is much easier to find things where you can save on costs and keep your cashflow in check.

4. Track Every Inbound Supply

Don’t just track the shipment. Track all inbound supplies that you have. For example, if you are selling furniture, you need to make sure that you have all the needed materials to make it. If just one piece is missing, you can’t make that desk or chair.

Knowing when your material will arrive makes it much easier for the workers to assemble the final product and start delivering it to the end user.

5. Improve Your Customer Service

You can never have a too good customer service. Always work on improving your customer’s satisfaction. One sure way of doing this is to keep them informed about their order. That means from start to finish. Hopefully, that finish is at their doorstep, but if there are any delays or other problems, you need to keep them informed about those as well.

The customer will much more appreciate your honesty and your commitment to rectify it (and if need be, you can always give them something extra as an apology) than if you keep your mouth shut and keep them in the dark about the shipment.

6. Try 3rd Party Logistics Companies

As an SMB you might not have the luxury of having your own logistics. That’s perfectly fine as there are plenty of 3rd party logistics companies or 3PLs out there. Don’t go for the first one you find though, or the cheapest one either. Get at least 3-4 quotes from different 3PLs and compare what they offer.

Even then, don’t settle for the first price. Always negotiate to get the best deal possible for your company.


Logistics is a crucial element in the supply chain and your business operations as a whole and it can make or break it. These 6 logistics management tips can help you make sure things run smoothly.

Do you have any thoughts or questions about the article? Let me know in the comments below and don’t forget to sign up for Purchase Order Plus.

supply chain management vs logistics

Supply Chain Management vs Logistics: What Makes SCM Different from Logistics

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Supply chain management includes many different elements. One of them is logistics. Despite this, there’s often a lot of confusion when talking about the two and even wrongly considering them as one and the same. They are not. In this article, we’ll get into the difference between supply chain management vs logistics and why it’s important not to think of them as the same thing. One reason is certainly not embarrassing yourself in a conversation.

SCM and logistics have many similarities, but they have different meanings. The biggest difference is in what each one represents. Logistics covers the flow of goods and their storage within the SCM On the other hand, supply chain management itself is a much wider concept and consists of several processes, of which logistics is but one.

To understand the difference between supply chain management vs logistics, we need to understand them better individually.

What is SCM?

Supply chain management includes connecting customers, suppliers and partners and that way offering value for the end user and improving efficiency within your own company.

Think of supply chain management as being the central thing that connects the manufacturer of the product, the wholesaler, supplier, retailer and finally the customer and making life easier for them all. As you can guess, that includes a number of functions and people in order to work well (like a well-oiled machine), logistics is just one of those functions.

What is Logistics?

Logistics, according to the Council of Supply Chain Management Professionals is a “part of the supply chain process that plans, implements and controls the efficient, effective forward and reverse flow and storage of goods, services and related information between the point of origin and the point of consumption in order to meet customer’s requirements.”

The goal of logistics is that the customer gets the product they ordered at the right price, the right quality and at the right place and time. To achieve this, logistics itself includes warehousing, packaging, transportation and more.

Logistics itself can be divided into two sub-categories:

  1. Inbound logistics includes activities and processes such as acquiring, handling, storing and transporting goods.
  2. Outbound logistics deals with collecting, maintenance and finally getting the product to the end customer.

Supply Chain Management vs Logistics: Key Differences

SCM and logistics need each other, but don’t fall into the trap of using the terms interchangeably. Here are the key differences you need to keep in mind:

  1. Logistics is one of many activities in the supply chain
  2. SCM connect the supplier, wholesaler, retailer, manufacturer and customer, improving business efficiency and getting the product to the customer.
  3. Logistics involves the flow and storage of goods within and outside the business
  4. The end goal of SCM is competitive advantage
  5. Logistics is focused on meeting the customer’s requirements.


There you have it! Hopefully this helped you better understand the difference between supply chain management and logistics and getting more efficient with them. If you have any thoughts or questions, we’d like to hear them in the comments below. Also, don’t forget to sign your email to get a free trial for our Purchase Order Plus. Purchase Order Plus is a mobile app for Xero that allows you to get better control of tour POs.

most common supply chain management mistakes

5 Most Common Supply Chain Management Mistakes You Need to Avoid

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It’s never a good idea to make mistakes in business. But while some mistakes are not that big of a problem, other mistakes can really hurt your business. Mistakes in the supply chain management fall into that category. Here are the five most common supply chain management mistakes that you should avoid.

1. You are Rushing with the Launch

The idea of launching their new product “now or never” has hurt numerous companies. In their zeal to put their shiny new product in front of the customer, they neglected a number of things, while entangling themselves into huge deals.

Before you launch a new product or protocol, be sure to check if your ordering and distribution system can cope up with it, especially if you expect a high demand, like during big holidays.

2. You are Prioritizing by Spend

Prioritizing or quantifying functions by spend made sense back in the 1990s, but not any more. At the time, it was common to have a single supplier for a certain product or item, but that’s no longer the case.

Today, supply chain managers realize that means that having 1 supplier for 1 item means walking on thin ice so to offset any disruptions, they bring in additional suppliers. The bottom line here is never put all your eggs into one basket.

3. Your Risk Management is Short-Sighted

Supply chain management is nothing if not full of risks. This is why you need to prioritize risk management and make sure your managers are ready and able to deal with all kinds of risks in a proactive and efficient way.

This way, you’ll be able to better react to any problems that arise, whether they have to do with increased demand, not having enough items in stock, poor quality, vendors or something else.

4. You Don’t Know Who is Responsible or Accountable

Who is responsible for the disruptions in the supply chain? The upper management will hold the Chief Procurement Officer or CPO accountable, but who can the CPO hold accountable? When no one is accountable, it creates confusion and lack of clarity when actions are needed.

5. Lack of Security

Security breaches are no uncommon, especially if you are operating online. These days, newspapers are filled with news about one company or other that got hacked. Your supply chain is at no lesser risk in that regard than other areas of your business and you need to ensure that you have sufficient security control. This goes for not just physical, but also (and perhaps more importantly) cyber security.

Additionally, make sure that your vendors don’t disclose sensitive information about your company or customers or do anything else that can harm your business. As well, be sure to monitor the security of your product throughout the entire chain to prevent any theft, or tampering, all the way to the end user.


These were just 5 supply chain management mistakes that you should be aware of. Of course, there are many others, so if you know of any that you think should be included here, let us know in the comments below and don’t forget to sign up for a free Purchase Order Plus trial.