How to Minimize Supply Chain Disruption
Every player in the supply chain must learn to expect the unexpected and have more than one plan in place. Many providers learned this lesson when the pandemic caused global supply chain disruptions. Unfortunately, many shippers and carriers are still struggling to bounce back.
You cannot completely eliminate supply chain disruption, but companies can develop strategies to minimize the impact of these incidents. While you can’t plan for every contingency, you can improve your organization’s ability to adapt to disruptions as they occur.
With that in mind, your company should develop proactive strategies now to maintain operational continuity in the event of another unexpected crisis.
Supply Chain Disruption Examples
Overcoming supply chain disruptions will require a resiliency plan that can adapt to any type of threat. Unexpected threats can come in many forms, and each one may call for a different response.
Here are a few examples of supply chain disruptions that may be out of your control but can be manageable with the right contingency plan in place.
Capacity Constraints and Transportation Delays
Due to pandemic-induced volatility, shippers and carriers are often affected by congestion, ongoing delays, and capacity shortages. Driver shortages are adding to transportation delays, as are increased regulations making it more difficult to move freight cost-effectively.
Weather and Natural Catastrophes
Severe weather and natural catastrophes can leave roads inaccessible, employees unable to work, and warehouses closed. Shippers must have alternative routing and sourcing plans in place to navigate these disruptions.
Sourcing Issues and Price Fluctuations
The vulnerability of modern supply chains became evident when the pandemic caused consumers to shift to eCommerce models following lockdown restrictions. This shift, in turn, placed more demands on the shipping industry.
Abrupt disruptions like this can drive prices up as product availability drops.
Cyberattacks
Cybercriminals can cause catastrophic disruptions when they hack into databases to steal critical customer information. This type of crisis significantly impacts a company’s ability to perform basic operations that affect its vendors, partners, and consumers.
Managing the Impact of Supply Chain Disruptions
Imagine a situation where the primary supplier of an essential material or product cannot meet the demand for several weeks or months. What is your secondary source? How soon can you get a new supplier on board to prevent extended lag time?
When supply chains are running smoothly, it’s easy to get complacent and take things for granted. Keep in mind that disruptions can happen at any time.
Three essential steps you can take to mitigate the impact of a sudden disruption include:
- Planning a solid crisis management strategy
- Evaluating potential supply chain risks in advance
- Diversifying your suppliers
The current supply chain disruptions show that you need to develop contingency plans to reinforce your supply chain against another unexpected crisis.
Find Expert Supply Chain Management at R2 Logistics
Having a contingency plan in mind is good, but you don’t know whether it will work until you use it in a real-world setting. With this in mind, it’s best to test your plans at least once a year. Note any potential vulnerabilities or challenges and resolve them before the next test. The goal is to identify potential problems before a real disruption happens.
With our extensive array of logistics solutions, companies find it easier to manage their shipping challenges. Whether your needs are complex or straightforward, contact R2 Logistics to learn more about how we can help you overcome supply chain disruptions. operation.