Wednesday, September 16, 2009

From “Just In Time” to “Just In Case”

“Seldom,” said a recent article in The Economist, “has corporate strategy been turned on its head so quickly.” For decades, accumulating and holding large amounts of cash was seen to indicate slipshod management, leading to takeover vulnerability and calls for special dividends.

That changed abruptly last fall, when the growing financial crisis suddenly caused short-term loan markets to freeze up, and left even solid businesses scrambling for cash to fill such basic needs as paying suppliers and meeting payroll. Companies from your LTL carrier to General Motors have been the focus of nervous speculation about the “burn rate” of their cash on hand.

Likewise, ultra-lean supply chains no longer look like such a brilliant idea when you have to find cash to keep afloat a supplier that cannot get even basic trade credit. “Just in time” is giving way to “just in case.” Being in the black is the new black – and cash on hand makes a firm look very fashionable.

Without any upfront expense to you, a knowledgeable third party logistics consultant can drive cash to your bottom line. Each and every month, you will see significant and measurable savings flow directly to your account. The additional insight and improvements you gain to your supply chain can be seen as just an added dividend.

800-989-0054 x105

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