It’s been said that in war, no battle plan survives first contact with the enemy. The point is that for all the strategy you bring to operations, there will be variables that can’t be controlled. This holds true for your business’s supply chain, as well. No matter how well-managed your logistics may be on paper, disruptions are not only likely — they’re inevitable.
The COVID-19 pandemic is an unfortunate reminder of this axiom, as 94% of Fortune 1000 companies experienced issues with their supply chains because of the disease. The fact that not even the cream of the crop of commerce could escape these issues should give any enterprise reason to be concerned.
Whether a disruption is caused by inaccurate forecasting, a sudden change in government regulations, labor dispute, or act of God, your company’s response is paramount. Sadly, not every business does its due diligence when it comes to preparing for these situations. The good news, however, is that you can give yourself some breathing room that can come in handy when you experience them.
For instance, diversify your suppliers so you’re not completely dependent on one or two key players. If possible, ensure that these partners are spread geographically so a natural disaster in one part of the world doesn’t leave you helpless. Creating an emergency fund to cover any loss in sales is another important step to take just in case. Although carrying too much can be dangerous, as well, storing some extra inventory can provide a cushion in the event of a supply problem.
To learn more about how to handle unavoidable problems with your supply chain, take a look at the accompanying resource.
Infographic created by WSI, a fulfillment logistics company