Ways to Avoid Supply Chain Disruptions

Supply chain disruptions happen when there is a disruption in the flow of goods from the factory to the customer. These disruptions can be caused by natural disasters, terrorism, and human error.
The best way to prevent these disruptions is to keep your supply chain as short as possible and have a backup plan for any potential disruption that could occur.
Here we are presenting some ways to avoid supply chain disruptions:

  • Be proactive to Supply Planning to Avoid Future Disruptions :

Supply planning is the process of forecasting and determining the demand for a product or service in order to meet that demand with the most appropriate supply.
In order to be proactive with supply planning, companies must first identify disruptions that may occur in their supply chain. For example, if a company is importing goods from overseas manufacturers, they need to have contingency plans in place for when those imports are disrupted by natural disasters or political unrest.
There are many ways to get better at supply planning, but one of the most important things is to do it often. The more you practice, the more efficient you will become at predicting future disruptions and making contingency plans for them.

  • Create an Effective Recovery Plan for When or If a Disaster Strikes

A disaster is one of the worst-case scenarios for any company. If a disaster occurs, it is important to create an effective recovery plan to prevent supply chain disruptions.
It generally takes 3-5 days for a new supply chain to be up and running after a disaster. It is important to plan for this downtime by storing inventory in multiple locations and creating alternative sourcing routes.
A lot of companies make the mistake of assuming that just because they have a disaster plan in place, it means they are prepared to survive any kind of disaster.
The truth is, every company needs more than just one type of plan in place to ensure they are ready for any kind of situation. That’s why it’s so important to have not just one but three types of plans: contingency, backup and recovery plans that work together to make your business resilient in the event of a disaster.
The responsibility of creating a disaster recovery plan should be distributed among all employees in the company as well as vendors that are aligned with the company’s core values and corporate mission statement.

Know Your Supplier & Their Capabilities to Minimize Risk of Losses During Disasters :

It is important for companies to reduce the risk of supply chain disruptions that can cause huge losses during a natural disaster.
Businesses should:
⦁ Know their supplier’s capabilities before an emergency arises.
⦁ Verify their supplier’s disaster preparedness plan.
⦁ Identify alternate source suppliers.
⦁ Limit inventory to essential items only.

Conduct Regular Risk Assessments With Suppliers To Address A Variety of Situations :

Risk assessments are an important part of any business. If you have suppliers outside of your jurisdiction, it’s important to regularly assess the risks that could disrupt your supply chain. Issues like natural disasters, political unrest, and labor strikes can all affect you so it’s best to be prepared.
The key to a successful risk assessment is identifying the risks and then prioritizing the most important and then making sure you have contingency plans in place.

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