Companies that diversify their logistics and use alternative routes overcome many supply chain problems.
Having a robust supply chain strategy will make businesses more resilient to supply-chain disruptions. There are two kinds of supply management issues: the first has to do with the supplier side, namely supplier selection, supplier relationship, supply planning, transportation and logistics. The second one deals with demand management issues. These are issues associated with product introduction, product line administration, demand preparation, item rates and advertising preparation. So, what common strategies can firms use to improve their capability to maintain their operations each time a major interruption hits? Based on a current study, two strategies are increasingly proving to be effective each time a interruption occurs. The first one is known as a flexible supply base, while the second one is known as economic supply incentives. Although many in the industry would argue that sourcing from the single supplier cuts expenses, it may cause issues as demand fluctuates or when it comes to an interruption. Therefore, relying on numerous manufacturers can reduce the risk associated with single sourcing. Having said that, economic supply incentives work if the buyer provides incentives to cause more vendors to enter the market. The buyer could have more flexibility this way by moving production among suppliers, specially in markets where there exists a limited amount of companies.
In supply chain management, disruption in just a route of a given transport mode can notably impact the whole supply chain and, in certain cases, even bring it up to a halt. As such, company leaders like P&O Ferries CEO and Maersk CEO work hard to add flexibility in the mode of transportation they rely on in a proactive manner. As an example, some companies utilise a versatile logistics strategy that relies on numerous modes of transportation. They urge their logistic partners to mix up their mode of transportation to incorporate all modes: vehicles, trains, motorcycles, bicycles, ships and also helicopters. Investing in multimodal transportation techniques such as a mixture of train, road and maritime transport as well as considering various geographical entry points minimises the vulnerabilities and dangers connected with depending on one mode.
To avoid taking on costs, various companies think about alternative channels. As an example, due to long delays at major worldwide ports in certain African states, some companies urge shippers to build up new roads in addition to conventional roads. This strategy identifies and utilises other lesser-used ports. In place of depending on a single major port, once the shipping company notice heavy traffic, they redirect goods to better ports across the coastline then transport them inland via rail or road. In accordance with maritime experts, this plan has its own advantages not only in alleviating pressure on overwhelmed hubs, but also in the economic development of rising areas. Business leaders like AD Ports Group CEO would probably trust this view.