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Massive Supply Chain Disruption in China: How to Avoid It

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The Port of Shanghai is seeing record-breaking port delays even by pandemic standards after another COVID variant sweeps through the area. And as such, many supply chains are once again desperately hoping to avoid the disruption, which has led to skyrocketing expediting fees, jammed alternate routes, and more. What’s a supply chain to do?

Diversify Sourcing

The number one way to protect your supply chain from global-scale bottlenecks is by having a global solution. For decades, many businesses have been using costs as the singular determining factor for where to source raw materials, labor, and manufacturing services. But that mindset is costing them now. When dealing in uncertain circumstances, the best way to keep your business safe is by spreading out risk. This is especially useful with sourcing of all kinds. While delivery may be cut off or slowed to one part of the world no matter what during a disruption, inability to access your sources will disrupt order fulfillment to all parts of the world.

Create Flexibility in Staffing

Much like with sourcing, most businesses have been adhering to a lean staffing model built to maximize profits. But companies that have prioritized workers’ bandwidths and benefits are more prepared to weather the difficulties staffs face today. Inability to hire and workers needing sick leave are less impactful when there are extra staff members to help share the load. Burnout and the great resignation don’t affect businesses that provide excellent benefits and pay. And hiring is easier when open and honest communication is given freely from the beginning including pay ranges.

Update Inventory Management Techniques

In the past, just in time services were the way to minimize costs and maximize throughput for your supply chain’s inventory management. But just in time logistics require certainty of how long it will take to source materials, manufacture them into a finished product, move them to warehouse, and deliver them to the customer.

The best way to safeguard your business now does include just in time principles like forecasting the ever-changing demand for products, but it also requires extra supply chain contingencies in place such as increasing safety stock on hand in case of delays and existing relationships with multiple carriers before bandwidth is high.

Double Down on Safety Systems

Hands down, the best way to keep your business moving during a health crisis is by protecting your staff. Just because local governments don’t require masking, gloves, testing, or temperature checks anymore doesn’t mean your private business must follow suit. Keeping these protocols in place will minimize risk for your team and demonstrate a commitment to their safety. Besides, the most invasive of these practices are still necessary for FDA cold chain compliance.

Invest in Green Innovation

Much like diversifying sourcing, one of the best ways to ensure your whole supply chain isn’t impacted by disruptions to the industry is by breaking it down into many smaller local networks. In fact, this isn’t the only green supply chain initiative that can serve as a precaution. Ethical product sources are less likely to see disruption. Zero-waste supply circles aren’t as susceptible to packaging shortages. A reduced carbon supply chain doesn’t see as many losses when gas prices rise. Overall, going green can really save some green in trying times.

As much as we’d all like it to be, supply chain disruptions due to public health aren’t over yet. Though some of these solutions are going to take time to implement, there are still some logistics techniques that can help your business out while it’s in a bind right now. Reach out to our team to learn more about what we can do to keep your freight moving smoothly.

Tags: Cold Storage, Logistics, Supply Chain

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