Supply Chain Audit: What is it and How is it Done?

You may have heard of the term “supply chain audit.” If you are unsure about what it actually is, then this Prestige Auditor’s blog is for you!

The main goal of a supply chain audit is the assessment of the company’s supply chain organization, systems, and processes. As a rule, the supply chain audit is based on scrupulous analytical research and in-depth analyses of any company’s information.

With the fast growth of e-commerce, supply chain audits are becoming more important, and more common. However, the process of supply chain auditing sometimes can be challenging. That’s because there are a number of processes and sometimes audits focus only on one segment. Supply chain auditing requires understanding third-party risks since the auditor has to understand important accepts like data, physical security, vendor code of conduct, and regulatory requirements. Online businesses also benefit from this, as eCommerce store audits have proven time and time again to be extremely useful.

Approaching

In some cases, a supply chain audit requires visiting vendors, factories, and warehouses to check the inventory in order to make sure that the given business actually exists. A cross-functional team is also required to identify and prioritize legal and human resources.

Auditors have to be aware of current affairs, macro-economic trends, and trade agreements within the business. They should understand the business and the environment in which the customers run in order to develop a high-quality response plan. Also, one of the most crucial parts of any audit is detecting whether the organization is working with vendors who offer high-quality service at competitive prices.

Methods and Demands

Among the most popular and acceptable methods of supply chain audits are rapid turnaround time, deep analysis, general research, and comparison. Comprehensive analysis means two-day local attendance with all the supply and support facilities and functions. A diverse and reliable foundation is the most crucial feature for an effective supply chain audit program.

The base should be comprised of process definition, data systems, universalization, and a powerful team structure. Only after implementing all these aspects will the results be pleasing.

The separate resources for documentation control, planning program tools, complete management, both supplier and results in monitoring have to be included in the audit program.

After conducting an audit, the client will be provided with a set of documents, including a comprehensive report. As a rule, it contains specific guidance for improving the efficiency of the company’s supply chain.

If you notice shortcomings within your supply chain, which are impairing the successful functioning of your business, Prestige Auditors will help solve the matter by conducting detailed business store audits. Due to the close cooperation with KPMG, we provide independent audit services in order to eliminate all the errors within your business. All you need to do is provide us with access to your supplier data, and we will increase the value to the customers and positively impact your company’s outcome! You can get more information on our auditing services by visiting our website or simply giving us a call!