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Supply Chain Risk – An Overview

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 Supply Chain Risk

To recognize and manage risk in your supply chain you must first become familiar with some common and some less common events that can cause delays and more serious disruptions. Whether you work with single suppliers or a group of them to produce your products, risks from economic instability to natural disasters can affect your business. This post is a first in a series that will discuss risks and consequences in greater detail along with strategies that can minimize damage to your business.

5 Delaying Events

  • Inadequate supplier capacity
  • Unanticipated demand
  • Late design changes
  • Raw materials shortage
  • Lack of attention


5 Disruptive Events

  • Weather
  • Theft/piracy
  • Accidents
  • Supplier bankruptcy
  • Labor disputes


5 Potential Consequences

  • Higher costs
  • Lower revenue
  • Lower customer satisfaction
  • Damaged supplier relationships
  • Damaged customer relationships


5 Strategies to Minimize the Risks

  • Manage supply chain proactively
  • Supplier qualification program
  • Open communication
  • Build strong relationships
  • Continual validation of supply chain against Risk Matrix

Supply Chain Risk

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