How Does Your 3PL Prepare for the Worst?

First, the question that needs to be answered is whether your 3PL is ready for a disaster. The light side of logistics is anything goes – from supply chain challenges to the effects of natural disasters. Any good 3PL partner has to have the right plans in place for such incidents to occur. But how do they ensure your business will not be affected and will progress during difficult economic periods? So, without further ado, let’s explore how a smart 3PL works towards the unexpected.

What are Those Contingency Plans That Your 3PL Company Has in Place?

Preparing the business for any unexpected disaster is a critical precursor to supply chain continuity among 3PL firms, including Prolog Fulfilment, which is the set approach in ensuring that the events leading to losses are ranked and controlled. It’s about implementing procedures that make it possible to react quickly in an emergency, reduce losses and disruptions, and maintain product content and unhindered movement. It brings a certain amount of comfort and reassurance and having your business in safe and capable hands.

Let’s explore some critical components of how 3PL providers, Like Prolog Fulfilment, prepare themselves for any uncertain disaster:

Risk Assessment

A well-known 3PL fulfilment like Prolog Fulfilment can detect the risks within its supply chain, such as transportation risks, risks from cyberspace, or risks due to natural calamities. 3PL providers have the ability, equipment and skills to instantly recognise unexpected risks. These capabilities help businesses quickly and make it easier for them to deal with them without being overwhelmed. They can also assist in developing and setting out emergency plans, tasks or procedures, training and practice sessions, and developing good relationships with suppliers and transport contractors.

Toyota And The 2011 Japan Earthquake:

Toyota reduced April production goals by 150,000 vehicles to 750,000. Toyota expects manufacturing to be 10% less in May and 5% lower in June than previously projected. Toyota will evaluate manufacturing plans monthly and three-monthly.

Emergency Planning

It is essential to devise contingency measures in the case of various events. A 3PL can assemble these plans and guarantee that all problems have been checked. This means that firms are in a position to concentrate on their core operations without having to worry about the formulation of their emergency plans. This level of preparation makes the firms feel prepared and in control; hence, they are well-prepared to handle any challenges that come their way.

Apple And The COVID-19 Pandemic:

Apple shows that contingency planning paid off for the company during the pandemic and opened up new growth areas, particularly in the services division. Focusing on Apple’s disclosed revenues, one can note that “Services” increased significantly in 2020. Even in the last three quarters of the year, the segment crossed more than  20 percent of the total revenue of the company. Some services are Cloud services, Apple Music, Advertising, Video, payments and Insurance.

Training and Drills

Employees need to be trained to handle emergencies. A 3PL can organise regular training and practice drills so everyone knows what to do in a crisis. This saves businesses from setting up these programs, which can be time-consuming and costly.

Supply Chain Mapping

It is only possible to recognise the supply chain’s deficiencies if one understands every aspect of it. A 3PL has experience developing clear and comprehensive logistics networks in the supply chain process from material acquisition through delivery. It gives businesses and everyone an understanding and assurance, making them feel at ease and accessible in their operations.

Walmart And Hurricane Katrina:

Walmart is leading in disaster relief, contributing $18 million and 2,450 truckloads of supplies to victims of hurricanes Katrina and Rita.

Partnerships and Collaboration

A 3PL can also develop and sustain cooperation with suppliers as well as transportation agencies. This makes communication flow well and dealing with problems flourish swiftly. These partnerships are not easy to handle in the business, making it relatively easy to have a 3PL handle them.

Contingency Planning: The Key to Supply Chain Continuity

Through Prolog Fulfilment, brands are capable of creating rock-solid contingency strategies that would still allow the supply chain to be uninterrupted in the event of an upheaval. Disaster contingency has a tremendous effect on operation stability. For instance, the Supply Chain Management Institute case study that was done in the year 2023 highlighted that firms with good 3PL contingency plans had fewer supply chain disruptions by 40%. In this research, based on more than 100 firms’ data, the contingency plan experiences showed that businesses with complete contingency approaches were more prepared to deal with disruption and sustain the supply chain.

Contingency planning with their 3PL suppliers should concentrate on the following for brands:

Alternative Sourcing:

It is also preferable to look for other suppliers for the same raw materials since the costs of many problems in the supply chain can be avoided. It is advisable for the brands to engage their 3PL suppliers to ascertain that these other sources are accurate and capable of scalable increase in supply.

At Prolog, we always ensure you get several dependable suppliers for any essential component, as shown below. It also reduces risks related to contract interruptions with your key supply chain partners, enabling your business to continue with operations if your main supply partners are interrupted.

Flexible Transportation Options:

Logistics is sometimes considered the most sensitive link in the supply chain, especially transport. If carrier modes can be adopted while working with a 3PL provider, transportation flexibility, including mode change, would help to maintain the supply stream in the face of route disruption.

In selecting the carrier modes, including rail, air and sea, flexibility can be achieved in the event of contingencies and improvement in logistics. The latest research has indicated that companies adopting more flexible supply chain transport policies have 30% fewer delays, cost 20% less per transport, and have 25% more satisfied customers.

At Prolog Fulfilment, we have a flexible transportation method as we incorporate various carrier modes to fit into the ever-changing conditions to ensure goods are delivered without interruptions.

Inventory Management:

Maintaining appropriate inventory levels is crucial to mitigating the effect of supply chain disruptions. Hence, 3PL has systems that align it so the business does not have to run with stress when allocating inventory. The brand should always work with 3PL providers to develop inventory plans that balance cost-efficiency with flexibility.

Conclusion:

In today’s unpredictable global environment, preparing for any unexpected conditions or disasters is essential to keep the supply chain going. For brands, partnering with 3PL providers such as Prolog Fulfilment and defining risks, developing the response strategies on top, and leveraging the technologies to enhance visibility and flexibility.

According to the research, management should ensure regular preparation exercises to sustain supply chain continuity during natural disasters, cyber-attacks, and global pandemics. Those brands which pay a great deal of attention to disaster preparedness and current planning with their 3PL providers will always be in a better position about supply chain challenges in today’s world so that no matter what the future holds in stock, the continuity of business and success will always be attainable.