Takeaways from West Coast Port Negotiations for Supply Chain Managers
Takeaways from the West Coast Port Negotiations for Supply Chain Managers
The 10 month labor negotiations at the West Coast ports resulted in unprecedented congestion at the ports almost to the point of a complete gridlock. Many U.S. based companies experienced delays ranging from 2 to 4 weeks, severely impacting retailers’ ability to stock their shelves as well as manufacturers’ ability to deliver to their end-customers. Such delays resulted in decreases in cash-flow and potentially damaged relationships for many companies. Now, as the ports attempt to dig out, importers and exporters should be looking to implement changes to their supply chain to increase their supply chain resiliency in the event of a disruption – whether large or small.
Disruptions in the way of extreme weather, port slow downs or strikes, forecast errors, or transportation breakdowns can impact a company’s operations, profitability, and competitiveness in the marketplace. As disruptions become more frequent, importers and exporters need to analyze their supply chains to uncover potential risks and bottlenecks and implement procedures to prevent or react to disruptions. With rapidly changing marketplaces, technology, and customer expectations, companies can no longer live by the adage “we’ve always done it this way”.
Supply chain managers should know the likelihood of a disruptive occurrence and the potential impact each event could have on the company’s operations and bottom line. Many companies are utilizing real-time visibility, historical data, and predictive models to quantify their level of risk. With this knowledge, supply chain managers can have the flexibility to adeptly respond to disruptions so as to minimize the effect it has on the company’s operations and ability to deliver to their end-customer on-time and on-budget.
Supply chain managers can leverage their freight forwarder as their supply chain partner to provide visibility and alternative options when disruptions occur. Good freight forwarders are those who proactively advise you of a potential disruption and outline alternative routings, schedules, and modes of transportation so as to protect you from any additional costs and delays. As a result of the west coast labor negotiations, all importers and exporters should analyze their supply chains and implement procedures to safeguard their company from costly supply chain disruptions.