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How to Minimise Supply Chain Risk
Author: Benjamin Wang
Managing a global supply chain is a never-ending balance act between cost and sustainability while also eliminating risks. The worry of things going wrong in your supply chain on the other side of world, keeps most managers awake at night. So what are some easy ways to minimise the risks involved when running a huge supply chain?
To ensure profitability, businesses should be constantly exploring new markets to discover new suppliers. Retail sectors can change at a drop of a hat and retailers need to be flexible in how quickly they can deliver to market. Having a wealth of suppliers and options of how and you work allows brands to function even when disaster hits. Finding a new supplier can open you to new risks as a business, especially in other countries. Make sure to do your research early in the planning stages. What local laws could hinder production? What is the political climate and geographical risks? The last two years a number of brands have come under fire for poor work conditions, low wages and in some of the worst cases; resulted in factory workers death. Even if this is not directly the fault of the brands, their association of factory deaths, has motivated some of the biggest names on the high street to keep a close eye on the risks of their supply chains.
Invest in a good supply manager. The supply manager’s job is to ensure that safety, product and legal requirements are met. However, this is where the role of the supply manager often ends. The surface needs are up to standards, but there is still the question of trusting the new supplier and other local factors that could disrupt the supply chain. In China for example, New Year can be a nightmare situation for supply managers without enough local experience or knowledge. The whole country shuts down, and for a large proportion of the workforce, this is non-negotiable. The supply manager has to deal with both language and cultural barrier in this case.
Don’t wait to call in expert advice when you come across these problems in your supply chain. At KSF Global, we are experts at managing supply chains and have a solution like no other when it comes to operating in China. Paul, our Asian Operations Manager has lived in China for over ten years with his family and is fully integrated into the culture. With his established relationships and understanding of what is happening locally, Paul is responsive to the client’s needs and is able to manage difficulties, be they technical, cultural or cost related. Paul’s situation is unique, so it can be extremely difficult to find someone who has his level of experience or local knowledge, which is why so many of our clients find it easier to operate through us. We highly recommend searching for the right person that you can trust as your supply chain manager, the investment is definitely worth it.