Supply Chain Continuity: Manage Disruptions and Alternatives

Supply chain continuity is a critical lifeline for businesses. This is especially true during and after the chaos of unexpected disasters. These situations challenge the strength of supply chains, highlighting the importance of preparation. The better your business can run during a crisis, the less your profits will drop.

The International Transport Forum notes the critical need for supply chain continuity during natural disasters and other disruptive events. They state that a resilient supply chain can:

• Reduce disruptions 
• Avoid delays
• Sustain fast delivery times

To maintain continuity during a disaster, businesses must prepare ahead of time.

Join us as we review supply chain continuity. We’ll show you how to keep it going in the face of extreme weather and other emergencies. 

What is Supply Chain Continuity?

Supply chain continuity is basically a proactive business strategy that’s focused on keeping goods and services flowing, even when supply chain disruptions take place. A well-made supply chain continuity plan should account for potential natural disasters. This will reduce loss of profit during challenging situations.

Why is Supply Chain Continuity Important?

Supply chain interruptions showcase the importance of a continuity plan. The benefits of having this plan in place include:

• Reduced Losses: Disruptions can cause huge losses and damage the reputation of businesses. Continuity helps avoid such scenarios.
• Keeping Goods in Transit: It ensures that goods keep flowing into the market. This is crucial for the economic health of businesses.
• Lowered Risks: Severe weather can wreak havoc on the supply chain. Continuity plans make these risks more manageable.

A well-planned continuity strategy has to be ready for anything. To make sure of this, it’s important to understand the disruptions a natural disaster can cause.

How Do Natural Disasters Affect Supply Chains?

When natural disasters hit, they can cause massive disruption to businesses. Everything from infrastructure and operations to supply chains can suffer. The aftermath requires companies to work quickly while assessing damages.

Let’s take a look at how different types of natural disasters can impact your supply chain.

The Immediate Impact of Natural Disasters on Businesses

Depending on where you or your vendors are located, your business may be subject to a variety of natural disasters. Each of these catastrophes is unique in the type of damage they can do. 

Some common catastrophes that increase supply chain risks are:

• Hurricanes: Flooding and power outages are just some issues hurricanes can cause. In some cases, they can even spawn tornadoes.
• Floods: Water damages warehouses, which leads to product loss. They can also make certain roads impassable , complicating routing. Wildfires: Fires can destroy facilities and cargo vehicles, causing severe supply chain interruptions. These can rage for days and weeks with lasting consequences.
• Tornadoes: The rapid onset of tornadoes causes unplanned halts in operations.

They require an immediate crisis response to address damages, which is a strain on resources.

• Blizzards: Icy roads cause delays or cancellations in transportation, impacting delivery schedules. Freezing temperatures can cause machinery to malfunction and slow production.
• Earthquakes: Quakes can damage buildings on a foundational level. Their potential for destruction of property is considerable.

Understanding these immediate impacts can help you create a proactive strategy for your business. Remember, your business doesn’t need to be hit directly to feel the consequences. A hurricane in Florida or a wildfire in California can affect far-flung businesses that may need resources or services those areas provide. 

It’s important to note that the damage doesn’t stop when the disaster passes. Let’s review some of the long-term effects of natural catastrophes.

Find out how hurricane cargo insurance can help your business.

Long-Term Consequences of Disasters on Supply Chains

Natural disasters can have lasting effects. They often cause long-term damage and delays to the supply chain. The setbacks caused by these delays can be costly for business owners.

Long-term challenges businesses face include:

• Strained supplier relationships
• Increased operational costs
• Altering the supply chain
• Market fluctuations
• Legal and compliance issues
• Brand reputation damage

Keeping your supply chain running smoothly is key to preventing these challenges. When the chain breaks down, your business can suffer. That’s why it’s important to be prepared when these events occur.

Maintaining Supply Chain Continuity During Natural Disasters

There are two key aspects to keeping your supply chain going during a disaster: preparation and execution. Severe weather can occur with little to no warning. Reacting alone won’t be enough to reduce damages and costs.

Preparing for Sudden Severe Weather

Preparation is the key to minimizing supply chain disruption. Business should develop long and short-term strategies to prepare for the worst. 

For example: is your businesses in a hurricane-prone area? Do your shipping lanes frequently traverse the infamous Tornado Alley?  If so, use storefronts and warehouses that can withstand floods and high winds.

The following long-term strategies will serve your business well.

• Infrastructure Resilience: Reinforce facilities to withstand extreme weather conditions by upgrading warehouses with weatherproofing materials to safeguard goods and assets.
• Diversify Supplier Network: Build relationships with suppliers in different parts of the United States. This will reduce reliance on any single area.
• Data Analytics: Invest in advanced analytics to forecast potential disruptions. You could reveal and understand vulnerable points within your supply chain.
• Employee Training: Teach your staff about safety protocols and emergency response strategies. 
• Technology Investments: Put supply chain monitoring systems in place to provide real-time updates. These systems should detect early signs of potential disruptions.

To supplement those long-term strategies, be ready to use these short-term measures too.

• Stockpile Essentials: Based on weather forecasts, increase inventory of essential items. You’ll want a surplus in case of supply chain interruptions.
• Backup Power: Have generators and backup power sources in place that can be used during outages. 
• Transportation Alternatives: Plan alternative transportation routes and modes to navigate around affected areas.
• Regular Weather Monitoring: Stay updated with the latest weather forecasts. Early warnings will help you make informed decisions about operations and logistics.

Proactive preparations are the foundation of a resilient supply chain. Know the risks, stay prepared, and be ready to react when disasters occur.

Don’t let your inventory take damage from storms. Follow the steps in our guide to inventory protection.

What to Do When Disaster Strikes

Preparation and preventive measures are crucial, but nature isn’t 100 percent predictable. Severe weather can strike with little to no warning. When faced with such imminent threats, businesses must act swiftly and decisively. Putting an action plan into place can be the difference between a brief disruption and a prolonged halt in operations.

When severe weather looms, respond accordingly.

• Mobilize your crisis management team.
• Secure assets and inventory.
• Backup critical data.
• Evacuate facilities in the path of disaster.
• Shut down and unplug vital electronics.
• Stay up to date on the disaster’s progress.
• Prepare for recovery operations.

Long-term preparation and short-term responsiveness will set you up for success in the face of natural disasters. Another way to be prepared is to put together a supply chain continuity plan.

Crafting a Supply Chain Business Continuity Plan

The destruction a natural disaster leaves in its wake can disrupt day-to-day business for days and even weeks. To keep your losses at a minimum, you’ll need a plan that accounts for disruptions to your usual shipping methods. 

You might think crafting such a plan is overkill or a waste of resources. If so, consider the following statistics derived from a poll of businesses in 2022.

Source: BCI Supply Chain Resilience Report

Nearly half of business owners in the survey believe natural disasters and severe weather are risks to their operations.

Others may have concerns with the infrastructure in their area. Places where power outages are frequent, whether because of an unreliable power grid or otherwise, also need to have a plan of action.

This contingency is called a supply chain business continuity plan, or SCBCP.

Key Components of a Supply Chain Business Continuity Plan

An SCBCP keeps your supply chain moving during and after unexpected disruptions. Given the inherent complexity of the supply chain, even a single link's failure can affect the whole network. 

To reduce these risks, especially after a disaster, it's wise to partner with an emergency logistics provider. They specialize in handling post-disaster challenges, ensuring that goods continue to move. In turn, you’ll be able to focus on your business’s other needs.

When you put together your SCBCP, keep the following guidelines in mind.

• Identify Risks: Identify critical components and vulnerable points in your supply chain. With the help of a logistics partner, determine the effects different disasters might cause to your shipping process.
• Alternate Routes and Warehouses: Search for alternative transportation routes and storage solutions. You’ll need them if a disaster affects your usual shipping lanes. Emergency Response Protocols: Determine the steps you'll need to take post-disruption. 
• Monitoring and Communication: Make sure your tracking systems can provide real-time shipment updates. This will benefit you and your customers.
• Resource Usage Strategy: Temporary storage space and alternate transport options should be found and possibly arranged ahead of time depending on the circumstances. 
• Post-Disaster Recovery Plan: This can include rerouting shipments, choosing priority deliveries, or sourcing from alternate suppliers.

Your SBCBP and emergency logistics agency will be your most important assets in the face of unexpected challenges. By staying prepared and leveraging specialized expertise, you and your business can weather the storm.

If you want to learn more about alternate suppliers, check out this article.

Implementation and Testing

Once your plan is complete, make sure any relevant personnel in your business are familiar with it. If possible, perform routine drills of the SCBCP. This will make it easier to implement the plan when the time comes.

Testing your plan can also reveal potential weaknesses in it. Take these opportunities to refine the SCBCP to maximize your readiness when disaster strikes.

Protect Your Supply Chain Continuity With Emergency Management Logistics

While you can’t always avoid natural disasters, preparation and the right business partnerships can reduce your risks. Speaking of partnerships, that’s where we come in.

Emergency Management Logistics has the know-how and resources to keep your supply chain moving. If an emergency impacts your business, look to us for assistance with:

• Time-critical logistics
• On-demand disaster relief
• Consults for developing an SCBCP
• And more

Get in touch with our emergency logistics experts at (855) 420-9447 or contact us online today. We’re here to help when severe weather threatens your business.