Discover what you can do to help protect your business and reduce the negative impact of any supply chain disruption that you may encounter. Plus, find out how to potentially strengthen those supply chains too.
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What you can do if your supply chain has been affected
Map out your supply chain
- Look at your business and all of your suppliers to understand where you have any critical dependencies.
- Map your supply chain to see where there could be an impact on your business if there was a hold up.
- Think about your 'supplier concentration'. This refers to how dependent you are on a small number of suppliers who may provide most of your materials. What would happen if they could not provide their normal level of supply?
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Diversify your sourcing
- If you use bespoke raw materials, sourcing other suppliers could be difficult, but in many cases the market will offer alternatives.
- Consider trade associations, trade fairs and chambers of commerce for locating possible partners, along with online research.
- Don't discount supply from other countries too - even after adding the costs of transport, they could be a cheaper or better quality option.
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Shore up stock reserves
- To prepare for potential increases in costs and delivery times, consider building up inventory now, if you have the financial capability and the opportunity to do so.
- Be careful to balance between adding a buffer of extra stock versus ‘overstocking’. Carrying too much stock could result in future cashflow problems if the market changes and there's a drop in demand for your product.
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Keep the lines of communication open
- Speak to suppliers to understand their challenges and work together to develop solutions.
- Understand who supplies your suppliers so you can anticipate any future changes. It may be difficult for you to see your full end-to-end supply chain, but making enquiries with your direct suppliers and their buyers can provide useful information.
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Prioritise which products you'll produce
- Think about prioritising your products that provide the most revenue rather than a full range.
- Prioritise what products to produce in the event of raw and direct material shortages.
- Consider how your raw materials are used and if one material is used in several finished goods.
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Evaluate alternative logistic options
- Anticipate logistics delays due to part congestion, reduced air freight capacity and driver shortages.
- If your sector has a trade association, contact them to find out about the latest sector-based challenges around logistics and potential solutions.
- The government’s Department of International Trade is also a good resource if you trade cross border.
- There are many specialist freight forwarders and logistics companies who are experts in this field - you may wish to consider their services.
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Ulster Bank support products
We offer a range of products to help businesses trade with confidence. These could help minimise the risk (the risk of not being paid by a buyer and the risks associated with supply breaking down) or provide more efficient financing than using your overdraft.
For full information on the trade finance products we have available please see our trade finance page.
Security may be required. Product fees may apply. Over 18s only. Subject to status, business use only. Any property or asset used as security may be repossessed or forfeited if you do not keep up repayments on any debt secured on it.
Business Builder workshop: responding to change
Join our free online workshop where we focus on facing up to change and examining both the pitfalls and opportunities it presents. We also consider how to develop a change-ready culture for a long-term business future.