Hurricane Season and Its Effects on Global Supply Chain
As hurricane season intensifies each year, the growing costs in damages and repairs has increased liabilities for many industries. As global supply chain relies on interacting global markets, extreme weather such as hurricanes must be taken into account. To give us a better perspective on how to handle your business needs, we have gathered information about hurricane season’s effects on the global supply chain.
Hurricane Effects on Supply Chain
Supply chain management (SCM) is a complex business on the best of days. Under adverse weather conditions such as a hurricane, a supply chain can quickly move from complex to chaotic, causing severe supply chain disruptions. Affecting air, land, and sea, hurricanes have the potential to really shake up global markets. On average, 14 hurricanes affect the Eastern Pacific Ocean alone each year, some with catastrophic outcomes. Fortunately, supply chain managers have methods to prepare for such events, keeping hurricane-related logistical problems to a minimum.
Preparing for a hurricane requires consideration of many possibilities. For supply chain managers, knowing the areas most likely to experience hurricane-related damage is vital. High winds combined with the potential for flooding make for a long list of potential problems. Most of the danger is focused on certain areas of the country and certain types of facilities involved in the supply chain. These areas include ports and warehouses, as they are often built close to the water on low land. Much of this danger is focused on Texas and Florida, which have the largest coastlines on the Gulf of Mexico. Transportation routes are also vulnerable as flood waters can wash out roads and major highways. Taking into consideration the estimated devastation of an approaching hurricane can greatly aid in working out the best option for your business.
When faced with a large storm, supply chain managers need to have an emergency plan ready for facilities in high-risk areas. Considering temporary warehouse services and stepping up production at facilities outside the path of disruptive weather are just some of the ways to keep operations working smoothly. Emergency plans should be developed far in advance with all providers along the supply chain. Working out a logistic plan prior to the event allows for every link in the chain to be prepared in the event of an emergency. Another strategy is to line up suppliers in advance in case primary providers can no longer function in the aftermath of a hurricane. This includes warehousing and storage, materials suppliers, and vehicle supply, such as ground or air transportation and fuel.
Protecting Your Supply Chain
Nearly 4 in 10 businesses never resume operations after a disaster. The culprit? Lack of planning. Through business continuity planning, organizations can address a range of potential risks, develop emergency preparedness plans, and help ensure an expedited return to normal operations. Supply chain professionals have an array of SCM concepts, strategies, and tools at their disposal to predict and mitigate disruptions caused by natural disasters, such as earthquakes or hurricanes.
A hurricane may not only impede the flow of goods along a supply chain, it may also prevent customers from getting to retail outlets to purchase supplies. Global corporations use supply chain visibility software to gather and analyze real-time data from their vast networks of suppliers. This allows supply chain managers to identify red flags and initiate alternate sourcing methods immediately. Expanding access to Big Data and analytics software allows organizations to predict where, when, and how weather conditions will impact their supply chains.
National Retail Systems- Keeping Your Cargo Safe
With hurricane season starting back up, make sure your cargo is in good hands. At Third Party Logistics, our experienced staff is prepared for whatever they may encounter on the road. We pride ourselves on using the most accurate, cutting edge technology to ensure satisfaction. For more information about our unbeatable services, contact us at 201-330-1900. Remember, your business is our business.
The Ultimate 3PL
National Retail Systems, Inc. (NRS) includes Keystone Freight Corp. & National Retail Transportation, Inc. (NRT). NRS is an asset based 3PL that has been providing logistics services for the World’s leading retail companies for 60+ years. Our hub locations include: New York & New Jersey; Los Angeles, CA; Inland Empire, CA; Savannah, GA; Columbus, OH; Greensboro, NC; and Baltimore, MD.