We’re in the midst of Hurricane season again. Here are a few strategies from Supply Chain 24/7 to prepare your supply chain for hurricanes and other natural disasters.
The first step a business can take to protect itself from loss due to natural disasters. Traditional property coverage, flood, and business interruption coverage should all be part of your preparation.
Warehouse Network Considerations
If you have warehouses or facilities in at-risk cities, you should plan ahead so you can act quickly if disaster strikes. If you can, build your warehouse network beyond cities in at-risk areas so you can ship orders from those backup warehouses.
You can also have contracts agreed on with temporary storage providers or cross-dock facilities before a storm hits.
Visibility and Communication
To manage the impact of a natural disaster, decisions should be made in real-time as the situation is unfolding. What does this mean for your supply chain? You should communicate to carriers and shippers about where supplies and resources are needed. Companies may need to quickly reroute things like home improvement materials to brace houses for storms, or food and water, which people like to stock up on before a storm hits. This then affects the entire supply chain--capacity is lessened, shipments are slowed, and companies without modern technology can have a breakdown in communication, which can cost millions of dollars. Real-time visibility and communication mitigate this negative impact by providing shippers with the tools they need to respond well to changing conditions.
Have backup partners ready to help keep things going during a storm if your main suppliers are affected by the disaster. It slows things down to research options or sign as a new customer during a disaster, so again, it’s smart to prepare now.
You may want to prepare to transfer production to a backup location in case your main facilities are impacted and can’t function. This should be thought of as a temporary solution as it will strain your other locations.
Ports are often hit hard during disasters like hurricanes. An important step to take is having agreements with your logistics partners for quick adjustments across shipping lines.
As Entrepreneur says, “ if your shipment to the Port of Miami is in jeopardy you can divert the container to deliver at another port and keep your product in motion.”
If you know a disaster is coming, see if your buyers can fill a bigger than normal order and ship more product ahead of the storm.
In addition to having additional fulfillment partners to help with larger orders, your supply chain should always have backup partners ready to help keep things going during a storm if your main suppliers are affected by the disaster. By identifying these potential new suppliers ahead of time, you can get out ahead of any potential shortages and keep your shipments flowing smoothly.
Retail and Grocery
Weather is no longer a usable excuse for late deliveries. Vendors are still expected to deliver food, beverage, and other consumables during a storm. Plan ahead to prevent dealing with lost sales and added fees. One thing you can do is keep an eye on weather predictions and talk with your transportation partners about expediting shipments.
If you have an asset-based partner, you can plan a short-term drop trailer plan. This means moving product away from at risk or affected areas to wait out the weather
Moving your product away from storm-affected areas can help you keep business moving smoothly. Most companies can consider shipping goods via rail. Although this would add transportation cost, it may be worth it to avoid damaged goods.
Because natural disasters reduce trucking capacity and make shipping more expensive, it’s important to budget extra funds for transportation in case of emergency. Figure out your plan for approving any extra costs so your team can operate as well as possible after a storm.
It’s vital to help areas affected by a disaster. Using a NextGen supply chain management system, digital supply chain technology like predictive analytics can help supply chains send needed supplies before disaster strikes. Predictive analytics gives you the chance to learn from past data of mistakes and solutions, letting you better plan your resources and routing for optimal performance, even during a storm.
Transparency through Technology
Having access to real-time info on every part of your supply chain--from tracking to suppliers and inventory--helps you address any issues that arise. Choose transportation technology partners that have NextGen visibility tools.
For more information about how technology can help you prepare for disasters, contact SwanLeap.