Developing a strategy to overcome supply chain disruption can be difficult. With so many complexities and ever-changing external factors, anticipating the unexpected can feel nearly impossible. But by building up your organization's supply chain resilience and strategy, you can better position your business for long-term success.
To help you get started, we'll walk you through the basics of organizational and supply chain resilience and teach you how to handle supply chain disruptions as they occur.
What is supply chain resilience?
Supply chain resilience refers to how effectively and efficiently a specific supply chain can adapt to and overcome external disrupting factors, such as inclement weather or sudden trade embargoes. Since disruption — in one form or another — is inevitable, it's important for businesses of all sizes to develop a strong supply chain strategy that can better handle supply chain disruptions down the line.
What factors cause supply chain disruptions?
There are many factors that can potentially play into supply chain disruption. These include:
- Weather (sudden inclement weather, natural catastrophes)
- Trade disputes, tariffs and embargoes
- Cyber threats and attacks
- Capacity constraints
- Transportation delays
- Pricing and sourcing issues
Luckily, there are ways to prepare your business for these potential disruptors, optimize your supply chain and gain end-to-end visibility.
How to Handle Supply Chain Disruptions
The degree to which your supply chain reacts to and recovers from disruption is directly correlated to how well your organization anticipates these challenges and maintains operational continuity. If your current strategy seems inadequate to handle supply chain disruptions, consider these tried-and-true tips to maximize your supply chain strategy and keep moving forward!
Buffer your inventory and avoid JIT solutions.
Just-in-time (JIT) solutions allow businesses to keep a minimum amount of inventory while maximizing profits, but they can cause some serious damage should disruption come knocking. If you run into issues sourcing materials, it may become difficult or near impossible to fulfill JIT orders, so make sure to buffer your inventory and keep some stock ready to ship out in the event of a supply shortage.
Don't have the warehouse space available to store extra inventory? GlobalTranz offers warehouse management solutions — plus, distribution and fulfillment services — to help your company thrive.
Stay agile by using a TMS for supply chain optimization.
Many companies operate utilizing data that may be several days old, and during a crisis, the situation can shift drastically in that time. Pricing, truck space and the availability of materials can change rapidly, but by utilizing a transportation management system (TMS), like GlobalTranz TMS, you can access up-to-date data and react in real-time to ensure business agility when it matters most.
Work with a variety of customers and suppliers to increase your resilience.
Over the past few years, it has become clearer to businesses around the world that customer and supplier diversification is crucial in times of market disruption. The vast majority of potential supply chain disruptions are geographically confined, so diversifying your market and network allows you to continue operating should something compromise part of your process. And as technology continues to advance, expanding your global outreach has become easier than ever.
Improve your organizational resilience to support your supply chain strategy.
For your supply chain to remain agile in times of disruption, your company must first be able to detect, resist and recover from disruption, regardless of its source. The best way to build organizational resilience and achieve supply chain optimization is to build a cohesive and comprehensive supply chain strategy by curating the people, processes and technology you need to stay ahead of the curve. Of course, higher levels of efficiency do cost more, so you'll have to decide on a budget appropriate for your strategy.
Work with a supply chain expert or trusted 3PL partner to maximize your efforts.
When disruptions happen — and they will — a strategic partner can be with you every step of the way. Working with a supply chain expert or trusted third-party logistics (3PL) partner provides industry insight and solutions you may not have had access to alone. In addition, a 3PL can provide you with a pre-qualified list of carriers, connect you with reputable suppliers around the globe and help you access and utilize real-time data to recognize and respond to disruptions as they pop up.
Optimize Your Shipping Strategy with Supply Chain Experts from GlobalTranz
The role of a 3PL in supply chain management is to help shippers like you create and curate the best possible solutions to meet their unique business needs, while also helping you monitor for and respond to market changes. That's why GlobalTranz offers a full suite of solutions to help you build, manage and protect your business. From supply chain optimization to managed transportation services and more, our supply chain experts are ready to help your business grow and thrive.