Supply Chain Risks: Downstream Risks

Supply Chain Risks: Downstream Risks

Downstream supply chain risks involve transporting finished goods to consumers, including order fulfillment and final delivery. As the past two years have demonstrated, many factors can disrupt this process. Proper preparation for any supply chain risks can help you prepare for any potential issues.

Strategies and Tips for Downstream Risks

There are several strategies and critical pieces of information to remember when it comes to managing downstream risks. 

Remember: Your customer’s risk = your risk
Manufacturers who specialize in particular products may rely on one or a small number of customers for their revenue. If these customers experience unexpected losses or go out of business, these dependent business relationships could mean disruptions for you. This makes studying the risk profiles of these customers a priority to have some insight into when these disruptions may occur.

Tip: Diversify distribution networks
In recent years, the increased pressure on warehouses can create difficulties in meeting product demands. Adding additional logistics providers and warehouse options is essential.

Consideration: Find partners investing in automation
Distribution centers have been forced to adapt to the changes a post-COVID world brings. Unexpected increases in demand for products have forced companies to push the envelope on innovation to meet demand. Aligning your business with partners investing in automation and other innovative tech is something to consider to ensure the most efficient level of service.

Plan Ahead: Create a contingency plan
Much like all other facets of the supply chain, service delays are nearly inevitable. Keeping a solidified contingency plan and careful data on hand for inventory numbers and location allows your business to be nimble and ready to tackle supply chain delays and shortages. 

Questions?

Turning your supply chain risks into advantages is key to staying ahead of the curve. Adapting strategies for the future of work, supply chain resilience, and digital maturity can help you keep pace and drive performance amidst economic demand. Talk to your trusted RCM&D advisor today for more on supply chain risks.