I am starting a small production business. I use a tropical vegetables as raw materials. This raw material is imported by local importers and i buy from distributors. My monthly usage is
1 palet (60 boxes).
Main problem: I am located in Montreal (Canada, Quebec), they import from abroad and is paid in $US , this causes a lot of variation in the price of the raw material.
The only way for me to manage this variation ($CA 55 to $CA 72) was for me to cut as many middlemen as possible but i did not have any success yet.
I buy only one palet at a time (it is not a big bargain position). How can i manage this ? i need a better control on the price of my material?
How can i manage my supply chain with the just ONE palet(60 boxes) to do the pricing of my end product? if i do not control the price of the raw material
Just curious - Did you evaluate the multiple approaches that i had suggested you for reducing Raw Material Cost.
Coming to your question here.
1. To understand the Pricing fluctuation you can go for Forecasting based on historical data of the Price Variation of your Raw Material, which will suggest that when will the lowest pricing point happen in a given Season / Year
2. The Pricing of the Output is in your hand (as we know the Input/ Raw Material Cost is not in your control). You can have a competitive Selling (output) price by adopting the following measures
a) If your Storage cost is cheaper then try to forecast and procure it when the raw material is at its lowest.
b) Reduce your other Operating costs like Rent, Labour, Finished Goods Packing
If you need more help on the above points please provide additional info