This informative article explains a few strategies to lessen and prevent supply chain disruptions. Find more here.
In supply chain management, interruption in just a path of a given transportation mode can dramatically affect the entire supply chain and, from time to time, even bring it up to a halt. As a result, business leaders like P&O Ferries CEO and Maersk CEO work hard to add flexibility in the mode of transportation they rely on in a proactive way. For instance, some companies utilise a versatile logistics strategy that hinges on multiple modes of transportation. They encourage their logistic partners to diversify their mode of transportation to add all modes: vehicles, trains, motorcycles, bicycles, ships and also helicopters. Investing in multimodal transport techniques such as a mix of train, road and maritime transport and also considering different geographical entry points minimises the weaknesses and risks connected with counting on one mode.
Having a robust supply chain strategy could make businesses more resilient to supply-chain disruptions. There are two forms of supply management problems: the first is due to the supplier side, namely supplier selection, supplier relationship, supply preparation, transportation and logistics. The next one deals with demand management problems. They are problems related to product launch, product line administration, demand planning, item pricing and advertising preparation. So, what typical strategies can businesses use to enhance their capability to maintain their operations each time a major disruption hits? In accordance with a current research, two strategies are increasingly showing to be effective whenever a interruption happens. The initial one is known as a flexible supply base, and the second one is known as economic supply incentives. Although many in the market would contend that sourcing from a single provider cuts expenses, it can cause issues as demand varies or when it comes to a disruption. Therefore, depending on multiple vendors can alleviate the risk related to single sourcing. Having said that, economic supply incentives work when the buyer provides incentives to induce more companies to enter the industry. The buyer will have more flexibility in this way by moving manufacturing among suppliers, especially in markets where there is a small amount of manufacturers.
To avoid incurring costs, various companies start thinking about alternate roads. For example, due to long delays at major international ports in some African countries, some companies encourage shippers to develop new tracks along with old-fashioned roads. This plan detects and utilises other lesser-used ports. Instead of relying on a single major port, when the delivery business notice hefty traffic, they redirect products to better ports across the coast and then transport them inland via rail or road. According to maritime experts, this plan has its own advantages not just in alleviating pressure on overrun hubs, but in addition in the financial growth of rising areas. Business leaders like AD Ports Group CEO would likely trust this view.