A whole host of factors in recent years have caused many businesses to see serious disruptions to their supply chains. The COVID-19 pandemic, Brexit, and increasing frequency and severity of natural disasters have made it a nightmare for some companies to get their raw materials and products from one place to another.
To help weather these storms, many companies are reevaluating the resiliency of their supply chains.
A resilient supply chain is one that is able to rapidly respond to challenges, keeping the flow of products and materials as uninterrupted as possible even in the face of difficulties.
If you’re seeking to make your business’ supply chain more resilient, here are 4 strategies you can employ:
Inventory & Capacity Buffers
The best and easiest way to insulate your business’ production chain from a slowdown in the receipt of raw materials or products is to maintain a buffer in either – or both – your inventory or your production capacity.
This could mean keeping additional stock of key products or materials on hand at all times, or maintaining additional production facilities that can be turned on or off at will.
The main drawback to this method is that it’s expensive. Keeping an inventory buffer requires the pre-purchase of all the additional items, as well as the space to safely and properly store them. And maintaining a buffer in capacity means you must have at least additional machinery and staff, if not an entire additional production facility, at the ready for when you need it.
Diversify Your Network
Where you sourced your materials and products from a few years ago may not be the most prudent choice right now.
Trade embargoes, weather conditions, or simple rising costs can all greatly impact the way your supply chain operates and whether or not you’re able to respond quickly to conditions that require you to change things up.
By carefully examining where you source your materials and products, you can discover whether there is another option that is going to be less disruptive to your supply chain in the long term. This may require you to source your items from multiple producers rather than one. Rather than waving off the option of multiple sources as too expensive or logistically complicated, you may come to find that diversifying your network means fewer disruptions and lower costs.
Part of what causes many companies to struggle when their supply chain experiences disruptions is not having a plan for when these conditions arise.
By taking the time to sit down and lay out what steps they’ll take in the event that part of their supply chain is disrupted, many companies are already light years ahead of their competitors in terms of preparedness.
Relying on memory or someone to step up and take the reins in a crisis is a mistake; having a detailed, written plan for disruptions to the supply chain is essential to keeping things rolling. By writing it down, it’s available for anyone to read and use and it can be put into action regardless of who’s on the clock.
Form a Crisis Management Team
As part of your crisis management plans, it’s essential to form a crisis management team.
In this portion of your plan, you lay out who does what in the event of an emergency. Each person should fully understand and be trained in their role, and able to step in at a moment’s notice to respond in a crisis.
Having a team of people with clearly defined roles – and who know what they’re supposed to do in an emergency – is key to being able to quickly respond. Your crisis management plan should be available to anyone in your organization if necessary, but the people on your crisis management team should be able to jump in and begin acting right away.
A quick response can be crucial in saving time and money when something goes awry, protecting your business against further loss.
Your 3PL Partner on the East Coast
For more than three decades, Cannon Hill Logistics has provided individualized third-party logistics services to clients of all kinds. Whether you need someone to manage a small portion of your operations, or you want to be able to outsource everything, we’ve got the skill and knowledge necessary to become a partner in your success. Call today for a quote!