Supply lines never look as vulnerable as they do when inclement weather strikes. At best, trucks face major delays as accidents and poor conditions make roads treacherous and, at worst, they suffer accidents of their own. Routinely, air carriers remain grounded while affected areas hunker down and airports close. Don’t think you’re safe even if you fall outside a storm’s high-impact area. Regions immediately outside of these zones, while typically spared the worst effects, can still face increased delivery times due to an overflow of traffic seeking safer routes outside of the storm’s path.
What this all means is that SLAs are essentially tossed out the window. Delivery times get stretched and capacity can be severely reduced as trucks, planes and rail cars stocked with goods are frozen in place, unable to unload and return for new pickups.
There are a few questions procurement pros should ask themselves in the sunny days prior to a bad storm. Incorporate these questions where possible into any Request for Proposal (RFP) drafts to test the market moving forward:
- What kind of severe weather would our shipping lanes see in a given year and what impact can we expect on transportation in those regions?
- How much redundancy are we maintaining across our supply base – do we have too much or too little?
- When and how do suppliers communicate delays due to severe conditions – do they have contingency plans to deal with bad weather that are shared with customers
- Among the suppliers we use, how much additional capacity do they have and how have bad conditions stretched capacity in the past?
- What are our critical lead times and how much room for lag is built into those times?
- What products do we purchase that can be warehoused? For those products that can be warehoused, how much inventory is kept on-hand, what is the financial impact of increasing this number and what is the risk of reducing it?
- Given that shipping rates will likely skyrocket during bad times, are we budgeting for the unexpected?
… And What You Can Do About It
No set of strategies will ever completely mitigate the impact of serious weather conditions. However, there are steps that procurement can take to lessen the impact.
- Plan as far ahead as possible. If your infrastructure, warehouse and consumption can handle it, plan to move shipping dates to avoid bad seasonal weather patterns, like hurricanes or monsoon seasons. If you can afford to move shipments forward or back, avoiding bad weather entirely is the way to go. Delays of even a day or two could lead to vast improvements in road conditions.
- Keep a clean house. A chain is only as strong as its weakest link. The best planning (or outright dumb luck) will mean nothing if shipments can’t make it the last few yards to your dock. Make sure you have plans to keep both your docks and parking lots free and clear. Ensure plow companies understand the critical areas to keep clear and remind them that a single car’s width won’t cut it.
- Consider your telematics solution. There are times when all roadways along your shipping lanes will be congested. That doesn’t mean you can’t adjust your routes for maximum efficiency. Routing software can prove valuable for rearranging plans on the fly. Additionally, you may do well to consider a complete Transport Management System review, especially if you haven’t gone to market recently. Test the competition by developing and executing an RFP. As mentioned above, ensure questions around handling inclement weather conditions are part of your RFP documents.
- Consider different modes of transportation. Keep up to date with suppliers who offer different modes of transportation; certain modes will fare better than others when weather conditions take a turn. If you identify a mode that’s preferable to your default, you may be able to recover time (although higher prices may come into play).
- Think about how far lead times can reasonably extend. Planning for longer lead times and discussing your options internally will give you a better understanding of crucial timing requirements and could potentially provide added cushion to avoid disaster.
- Consider strategy changes, including drop shipping. Removing one of the mid-process stops, such as going to a central warehousing system, could shave off enough time to make up for delays caused by a storm.
At the end of the day, the only thing you can control is how your organization responds to weather-related challenges. Everything else is in Mother Nature’s hands and she always likes to have her say when it comes to transportation. Some days you will enjoy smooth sailing and other days you will suffer massive headaches regardless of your best laid plans.
One thing is certain – the more you do to prepare now, the better you will do when the next big storm heads your way.