In many places, people have become accustomed to shopping for whatever they need and getting the product as soon as possible.
However, there may be times when a product’s supply becomes disrupted by situations or reasons like natural disasters or events like the pandemic, and the sellers and consumers face the issue known as supply chain shortages.
This issue, known as supply chain disruption, can create uncertainties for businesses and their customers.
Sometimes, these disruptions can be localized and small and d not become harmful; however, at other times, those can be a global incident and can hit a big region with a lack of supplies.
What is a supply chain disruption?
A supply chain disruption is a specific network of organizations, people, and even activities that can move a specific product from a supplier to its customer. This issue, known as supply chain disruption, is a crisis that can happen both locally and globally and can have a negative impact on the business of a product.
Reasons for Supply chain disruptions
There are several reasons for supply chain disruptions or supply chain shortages. Those reasons are:
- Natural disasters
Natural disasters like tornadoes, hurricanes, wildfires, or floods can have an impact on the supply chain of several products in the affected area.
- Pandemics
As you may have already seen, pandemics like the COVID-19 have a great impact on the global supply chains.
- Problems regarding the product
Quality management is connected to supply chain management, and hence, issues regarding a product can eventually result in supply chain shortages.
- Transportation issues
The increased trade and globalization have made it really common for various businesses to work with several international suppliers. As a result, business opportunities have increased, along with the increased strain on domestic and international transport networks, resulting in product delays.
- Price fluctuations
Fluctuations in the price of the products can also work as a big reason for supply chain shortages.
Tactics for preventing and addressing supply chain disruptions
Here are a few ways through which preventing and addressing supply chain disruptions can be done.
- Build up inventory
Creating a stock of several essential products can help you to save your business from supply chain disruptions for several weeks or months. Thus, storing several goods or even their raw materials can help you fight against supply chain shortages.
- Create an emergency plan
Having a backup plan regarding supplies is always a good idea. While creating this plan, you need to plan all the ways through which you can move your goods around. Along with this, you can create an emergency budget that can help you in case of disruptions.
- Identify your backup suppliers
You need to identify several suppliers in different geographical locations and build a good relationship with them to get what you need in times of crisis.
- Conduct a risk analysis
You need to analyze the risks and find out the weak links in your supply chains. This will help you to find out where you need to choose an alternative. With this, you can successfully assess potential social, environmental, and even political issues that may affect your supply routes.
Therefore, there are several powerful ways to prevent and address supply chain shortages or disruptions regarding any particular product.
Having a backup plan regarding supplies is always a good idea. While creating this plan, you need to plan all the ways through which you can move your goods around. Along with this, you can create an emergency budget that can help you in case of disruptions.
You need to identify several suppliers in different geographical locations and build a good relationship with them to get what you need in times of crisis.