Did you know that almost 40% of U.S. small businesses experienced supply chain delays due to the COVID-19 pandemic?
The pandemic was hard on a lot of companies, but there are ways to minimize disruptions that occur from unforeseen circumstances.
To learn about supply chain disruptions, how to minimize delays, and what to do during a disaster, keep reading.
Types of Supply Chain Disruptions
Supply chain delays can happen for various reasons. Before we get into how to minimize disruptions, it’s important to know the different causes. The solution to your delay will depend on the cause of the disruption.
These are the most common reasons your supply chain might see a negative impact:
- Pandemics
- Price fluctuations
- Transportation failures and delays
- Natural disasters
- Product problems
- Cyber attacks
Each problem has its own probability and severity that will play into minimizing delays. Now, let’s get into the seven ways to minimize supply chain delays.
1. Have an Emergency Plan
For every cause of supply chain delays, you should have an emergency plan. It will take a lot of time, effort, and research to create a plan for each, but you will be thankful you did if an emergency were to occur.
It’s essential to have a backup procedure, especially when it comes to supplies. To create an emergency plan, think about alternative ways to move goods around. Consider setting an emergency budget aside as well.
2. Build Up Inventory
Supply chain disruptions can last months at a time. Build up an inventory of necessary supplies that your business can use for the time you experience supply chain delays.
Creating a stockpile of supplies might mean having a store of completed products, product components, or raw materials. Place everything you need to maintain your business during a supply chain disruption in this inventory.
3. Conduct a Vulnerability Audit
You can minimize disruptions in your supply chain by conducting a supply chain vulnerability audit. Fine time to complete a risk analysis to learn where the weakest links in the supply chain are.
The audit will help you focus on where you need to come up with alternative methods for your processes. Asses social, political, and environmental possibilities that can impact your supply routes during this audit.
4. Identify Backup Suppliers
When your current supplier is unavailable to you, look at other suppliers that can provide you with what you need. Typically, this means identifying suppliers in different geographical locations and building relationships with them.
When you have a supply chain delay, your good standing with various suppliers will convince them to step in and help you out when you need it most.
5. Diversity Supply Base
Investors know to diversify their portfolios. Supply chain managers should know to diversify their supply base.
Simple diversification in the supply chain process can go a long way. When you have suppliers in different places, you are able to get some goods distributed despite a disruption.
Don’t diversify too much. Working with too many suppliers at a time can cause more confusion than helpfulness.
6. Partner With a Logistics Professional
Another one of the supply chain disruption solutions is to work with a supply chain and fulfillment expert that can support you when disruptions occur.
These partners can help with finding alternative courier solutions and can navigate you through an entire disruption. You’ll deal with some fees and surcharges at this time that a logistics expert can handle.
Logistics professionals often use platforms that allow them to show delivery lead time and taxes. This can go a long way in helping you manage the expectations of your customers during disruptions.
7. Implement Risk Evaluation Tools
The best way to evaluate supply chain risks is by using technology. Environmental analysis solutions and AI-enabled mapping are just two of the tools you can integrate into your supply chain.
Even social media can be used as a tool to identify supply chain shortages and disruptions these days.
What to Do When a Disruption Occurs
Of course, even when you try your best to minimize delays in the supply chain, disruptions can still occur. What do you do at this point in the process?
Moving forward in the short term involves learning about crisis management solutions. Here are some of the steps to take when a supply chain delay happens:
Communicate With Customers
Avoiding customer communication during a crisis is one way to prevent clients from coming back. Be transparent with your customers about the issues your supply chain is facing.
Your customers are more likely to be understanding when you tell them the truth.
Communication doesn’t stop with customers. You should also be consistently speaking to distribution partners and the rest of your team to handle the crisis effectively.
Evaluate Critical Components
Supply chain solutions work best when you figure out what you need to continue operations. This is where your inventory will come in handy. If you set up a stockpile as suggested above, you will have some materials to work with.
Additionally, if you find backup suppliers in other locations, you can make the supply chain disruption work in your favor.
Assess Buyer Behaviors
Supply chain disruptions can occur from changes in demand. A global pandemic, for example, can change what consumers are purchasing and how they are purchasing it.
Keep track of changing buying behaviors to understand what products your customers are seeking. If necessary, pivot to products that match the demand.
For example, during the COVID-19 pandemic, a lot of businesses started selling hand sanitizers when they didn’t before.
Minimize Supply Chain Delays for the Future
There are different reasons supply chain delays happen. If you want to minimize these delays in the future, you need to follow the seven tips in this guide.
If you run into an issue within your supply chain, always communicate with customers, evaluate critical components and inventory, and asses buyer behaviors.
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