Summary In the contemporary business environment, digital procurement is becoming increasingly popular and sought after by businesses around the world. The relationships …
How value chain consulting helps improve profit margins and sustainability
Focus on how supply chain consulting optimises operations for financial growth and environmental impact.
Why value chain consulting matters
Approximately 70% of international trade is driven by global value chains (GVCs). These chains span multiple countries as goods and services – from raw materials to finished products – cross borders repeatedly. The rise of GVCs is reshaping industries, creating new opportunities and challenges for businesses. As this trend continues, businesses must focus not only on improving profits but also on building sustainability and resilience in their supply chains.
Supply chain consulting helps businesses enhance their operations by evaluating, redesigning, and optimising their value chains. Consultants dive deep into every stage of the chain – from design and production to marketing and distribution – to uncover inefficiencies, identify new opportunities, and ensure that sustainability and resilience are prioritised.
Consultants approach value chain optimisation by thoroughly assessing each stage of your supply chain.
Evaluation
Assessing workflows, spotting bottlenecks, and identifying inefficiencies or risks to improve overall performance.
Redesign
Recommending new strategies, technologies, or partners to enhance performance, drive efficiency, and cut costs.
Optimisation
Implementing changes to ensure smoother operations, increased sustainability, and resilience against challenges.
Supply chain consulting is particularly valuable for businesses seeking to improve profit margins and sustainability. Whether your company is looking to streamline operations, reduce costs, or adapt to market shifts, a strategic review of your value chain can reveal areas for significant improvement.
By focusing on the entire value chain rather than isolated components, businesses can develop more holistic strategies that improve their bottom line while contributing to long-term sustainability goals.
How value chain consulting improves profit margins
Did you know that 79% of companies with high-performing supply chains experience revenue growth above the industry average? Additionally, businesses with optimised supply chains can cut supply chain costs by 15%, reduce inventory holdings by more than 50%, and speed up cash-to-cash cycles by 3X. Here’s how supply chain consulting can directly boost your profit margins:
Cost reduction
Supply chain management consultants identify inefficiencies in every stage of the value chain, from production to distribution. By pinpointing and addressing these areas, businesses can eliminate waste, streamline operations, and ultimately achieve significant cost savings.
Optimising resources
Effective resource management is key to reducing waste and boosting productivity. Value chain consultants help firms better allocate and utilise their resources, ensuring that operations run more efficiently and that excess inventory, labour, or energy consumption is minimised
Strategic sourcing
By evaluating supplier relationships and procurement strategies, consultants can help firms find the most cost-effective and reliable sources for raw materials and components. Strategic sourcing can lead to lower costs, better quality control, and enhanced supplier relationships.
Process improvement
Value chain consulting is built on a foundation of continuous improvement. Consultants employ strategies to enhance workflow, reduce redundancy, and optimise production processes. These improvements drive higher efficiency, lower costs, and ultimately boost profitability.
By focusing on these areas, supply chain consulting enables businesses to improve their profit margins through smarter, more efficient operations.
How value chain consulting contributes to sustainability
40% of businesses prioritise electrification, while 29% focus on natural resource management for supply chain sustainability. However, many companies face challenges in measuring the return on their sustainability activities, with some focusing primarily on savings and efficiency rather than broader sustainability goals.
Here’s how supply chain consulting can help companies achieve long-term sustainability:
Environmental impact
By optimising the supply chain, consultants help reduce carbon footprints. This includes better logistics planning to minimise fuel consumption, eco-friendly sourcing of raw materials, and leveraging technologies that reduce environmental impact. The goal is to lower emissions, reduce energy usage, and maintain operational efficiency, supporting both sustainability and performance.
Sustainable practices
Consultants implement sustainable management practices that foster long-term environmental responsibility, such as the circular economy, waste reduction, and energy efficiency. These practices reduce waste and emissions while making operations more cost-effective by maximising resource use, minimising waste, and enhancing overall operational efficiency, driving long-term sustainability.
Risk management
Sustainability efforts help mitigate environmental and regulatory risks. By adopting sustainable management practices, businesses reduce the risk of non-compliance with regulations and anticipate changes in laws related to carbon emissions, resource usage, and waste management. This proactive approach helps shield companies from potential fines, legal issues, and reputational damage.
Social responsibility
Value chain consultants also integrate social responsibility into the supply chain. This includes ensuring fair labour practices, ethical sourcing of materials, and promoting diversity and inclusion within the supply chain. Social responsibility not only enhances a company’s reputation but also builds stronger, more resilient relationships with customers, suppliers, and communities.
By focusing on these areas, supply chain consulting not only drives operational efficiency but also ensures that sustainability becomes a core part of business strategy, helping businesses navigate environmental, regulatory, and social challenges.
Why choose Kronos Group value chain consulting services?
Kronos Group offers expert procurement consulting that helps businesses optimise operations, reduce costs, and improve sustainability. Our team brings deep industry knowledge to assess, redesign, and streamline your supply chain, ensuring efficiency and resilience. With a focus on long-term value, we help you navigate global challenges, minimise risks, and enhance performance, driving both profitability and sustainability. Let us help you create a more efficient, sustainable, and future-ready value chain.
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FAQ
A value chain in consulting refers to the series of activities a business performs to deliver a product or service, from raw material sourcing to customer support. Consultants help optimise these activities to increase efficiency and drive profitability.
- Inbound logistics: Receiving and storing raw materials.
- Operations: Transforming inputs into products/services.
- Outbound logistics: Distributing products/services to customers.
- Marketing and sales: Promoting and selling products/services.
- Service: Post-sale support and maintenance.
Business value consulting focuses on helping companies enhance value by improving processes, increasing profitability, and aligning operations with strategic goals. Consultants provide recommendations and ongoing support to ensure measurable outcomes.
