supply chain risks

10 Supply Chain Risks Shippers Need to Address

by Ruth Seeley

Cyber attacks, global trade tensions, and an increase in container ship fires are some of the top 10 supply chain risks identified by DHL’s Resilience360 in its first annual risk report.

After studying and evaluating developments over the course of 2018, the report looks at events that can create short-term costs, delivery challenges, or disrupt cargo flows.

In 2019, shippers need to assess the following risks for every supply chain network.

  1. Trade wars: import tariffs will lead to ongoing manufacturing network restructuring
  2. Raw material shortages: demand spikes and production bottlenecks can lead to widespread disruption
  3. Quality control and compliance issues: wider public awareness of quality issues and stricter enforcement by regulators is likely to rise, especially in the pharmaceutical and medical device sectors
  4. Climate change impact heats up: As it did in 2018, the changing climate is likely to have wide-ranging effects on global supply chains
  5. Tougher environmental regulations and enforcement efforts make polluters pay:  tackling climate change, local air quality, and other forms of environmental pollution has increasing buy-in
  6. Economic uncertainty and structural change put suppliers under threat: a global trade war, Brexit, and stricter environmental regulations could put pressure on smaller industrial and automotive suppliers and lead to more insolvencies
  7. Cargo caught up in industrial unrest: The impact of strikes, overtime bans, or work-to-rule can affect any transport mode
  8. Hazardous transport: container ship fires: a number of container ship fires and accidents in 2018 and 2019 highlighted may become more commonplace
  9. Battles at the borders to increase wait times: Migrant influxes in various parts of the world is leading to increased focus on physical border security
  10. Drones strike a blow to aviation safety: airport disruptions related to air traffic safety are likely to become more frequent in 2019, and thus present a greater risk of disruption to aviation logistics operations.

Source: Resilience360

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