7 Supply Chain Hacks That Can Save You Money

An optimized supply chain isn’t just for your company.

Integrated and optimized supply chains were created to “get your customer what they want when they want it – and accomplish that spending as little money as possible.”  When deployed with all its awesomeness, an optimized supply chain can turn a mail-order DVD company into Netflix or a computer manufacturer that had lost its way into Apple. 

Now imagine you can harness that supply chain power for your own personal life.  You may not need to get 1,000,000 Toyota Camry’s into production and delivered to every dealership across the country, but here are seven supply chain hacks that can save you money in your day-to-day.  From your pantry to your iPad, these supply chain hacks will cut costs in your personal and home budget.

Re-Order Points

Re-Order Point
Manage re-order points to help lower your grocery spend. Re-Order Now. Getty Images

I have a friend who buys coffee, butter, and sugar every time she grocery shops.

She says she’s never sure if she needs them, but figures she will at some point.  While that’s a great strategy to make sure she can bake a coffee cake at a moment’s notice, it doesn’t really optimize the household budget. 

Learning to manage re-order points – just like a supply chain pro – can help lower your grocery spend.  A clear, visual example of day-to-day spend that has a built-in re-order point is the gas for your car.  When you see the gauge at a quarter tank, you re-order (i.e. refill).  You can do that with your groceries, too.  When that peanut butter hits the bottom of the Skippy label, it’s time to re-order – and no sooner.  For sugar and coffee, use a kitchen scale.  When that bag hits 3 ounces, it’s time to shop.  Managing your grocery re-order points will help you optimize your personal budget.

Cycle Counting

Did you know you already cycle count?.

Most companies use cycle counting as a way to help manage their inventory. But did you know that you cycle count, too?

Before you head out to the grocery store, when you poke your head into your pantry and check to see what you need to buy – that’s cycle counting.  Formalize this process by figuring out what your high value and high turn items are.  These are the items you want to count on a regular basis.  By cycle counting your Haagen-Dazs pralines and cream (not sure if that’s a high value or high turn or both), you’ll make sure you’re always in stock, but you’re not spending too much to stay that way.  Combine cycle counting with re-order point management to supply chain hack your way to big savings!

Six Sigma

Six Sigma
Six Sigma your day! Doesn’t that sound fun? Six Sigma. Getty Images

Six Sigma your day! Doesn’t that sound fun?

Okay, first of all – you might need to know what Six Sigma is.  Companies employ the Six Sigma process to reduce defects in their processes by making them more efficient.  You can do that, too, and one simple example is planning your Saturday.  Look at your errand list.  Now look at Google Maps.  Don’t go to CVS, then head across town to Whole Foods, and then double back to Home Depot.  Six Sigma your errands by making the process more efficient.  You’ll save money on gas.  (Let’s say you save a half-gallon doing this and you do that 50 weekends a year.  You’ve just saved two tanks of gas.)  And with the time you’re saving, you can look at how to employ the remaining four supply chain hacks.  Of course, a supply chain pro might point out that this isn’t exactly a Six Sigma approach but more of a Lean approach.  To that person, I say, “Well played.  Now read this and compose your apology email.”


Find new suppliers to save money!.

Companies look for new suppliers for several reasons – to help improve cost, because of quality issues, improved technology, geographic tax breaks and so on.

You can do the same thing to save money.  Whether it’s your exterminator or handyman, it may be time to “re-source” – or find another supplier.  Oftentimes, by just letting your current supplier (or handyman) know that you’re looking for a supplier to replace him, you can drive costs down. 

If you’re looking to cut costs, you can’t be emotional about it.  Maya may have been styling your hair for years now, but if Maya’s costs have increased – it may be time to re-source your barber/stylist. 


RFQ's are the supply chain pro’s bread-and-butter tool for re-sourcing. Kanban 101. Getty Images

The Request For Quote (or RFQ) is the supply chain pro’s bread-and-butter tool for re-sourcing and finding a supplier for a new product, service or need.

While the RFQ is a very technical and precise supply chain process, my mom calls it “comparison shopping”. 

Whether it’s time to look for a new barber or coffee shop or burger joint, the RFQ helps optimize the process.  Let’s take the burger joint example.  You’ve been going to Burger King but their prices have gone up and you want to try this new supply chain hack RFQ thing to save some money.  Time to line up other potential suppliers.  McDonald’s, In & Out (you live in LA), and the local burger stand make the short list. Do the potential suppliers offer the same products?  If all of them except the local burger stand offer a fish sandwich, does that count against the local stand?  And if you’re a Whopper eater, you can’t compare the Whopper price the McDonald’s basic hamburger price.  Your RFQ comparison has to be apples to apples.  Or, in this case, Whopper to Quarter Pounder. 

Your RFQ should take in all factors around using each new supplier.  Is the local burger joint closer than your Burger King?  Will you save time and gas money eating there?  And do the ancillary costs of switching to one of the other burger joints off set any cost increases?

Contract Termination

Contract Termination might be easier than you think. Terminate that!. Getty Images

As hard as supply chain pro’s work to negotiate contracts, it’s amazing to see how meaningless they can be when one or both parties want them terminated.

You can use this supply chain hack to get out of almost any contract you’re in.  Contracts for cable service, your rent and your cell phone are just pieces of paper.  And those papers have termination clauses typed onto them. 

In some cases, all it takes to terminate a contract is “notice”.  That means that you let the other part know you want to terminate and 30 days or 60 days (whatever the contract period states) later, it’s over.  Or sometimes you pay a fee.  But if you want to get out of your high rent and move to your buddy’s guest room, it might make sense to pay a fee to get out of your rent – because in the long run, you’ll be saving money.

It doesn’t hurt to approach the other party about contract termination.  They may want to cancel, too (especially in the case of landlords) and, if the desire to terminate is mutual, it’s usually free.  Also, if it’s your cable or cell provider – they’ll probably give you a cheaper rate once you tell them you’re willing to pay a fee to cancel and walk.

Supplier Negotiation

In life and supply chain - everything's negotiable. Say again. Getty Images

I once watched a customer at The Gap ask a store clerk, “What’s the best price you can give me for this belt?”

The clerk explained that the price was on the tag.  The customer then asked to speak to a manager.  She asked the question one more time, “What’s the best price you can give me for this belt?”  The manager knocked 10% off the price on that tag.  That’s a true story.  And it goes to show you that whether you’re at the farmer’s market, car dealer or the Verizon store – all pricing is negotiable.