5 Ways 4PL Can Mitigate Supply Chain Risk

The Word Risk Being Erased - Cedric Millar Supply Chain Logistics Company

The true test of a supply chain isn’t how it performs in good times, but rather how it responds and adapts during times of crisis.

A supply chain disruption doesn’t have to be as dramatic as the COVID-19 pandemic to interrupt the flow of goods – something as simple as a flat truck tire can result in huge implications for your supply chain.

In other words, supply chain risks are simply a part of running a business.

Fortunately, a cost-effective way to mitigate supply chain risks is with a 4PL supplier who can completely optimize your supply chain, no matter how complex, so you are ready when crisis strikes.

4PL solutions are designed to help companies mitigate risks to their supply chains wherever they might originate, and give you the ability to respond swiftly so your goods can continue moving with as little interruption as possible.

Here are five important ways that a 4PL supplier can help you mitigate risk to your supply chain:

Allows For Professional Analysis And Insights

4PL suppliers perform a methodical review of your business, with a special focus on the people, processes, technology, suppliers, customers, and market conditions that drive your supply chain. This will help your 4PL supplier determine your exposure to potential risk, and how disruptions will affect your operations.

Along with the analysis comes a comprehensive set of recommendations that will optimize your supply chain today, as well as a strategy to help your business withstand potential disruptions down the road. This approach would include the ability to make quick, efficient changes to your processes that will keep your products moving in the event that a service interruption occurs.

Matches You With The Best Suppliers

With supply chains growing in complexity, the number of suppliers involved in your supply chain has never been greater. More players in the mix means more risk potential, as well as the ongoing need to assess your current suppliers. With so much at stake, you run the risk of partnering with the wrong provider, which could be disastrous for your company.

If you want to make a switch, or see who else is out there, a 4PL supplier already has an extensive supplier network. Their network consists of suppliers pre-screened for their capabilities as they relate to your business, ability to scale, control over their operations, financial health, approach to customer service and collaboration, and more. Going through this process ensures that your goods will always be in the care of reliable, reputable suppliers best suited to your needs.

Reduces Dependency On Single Supply Lines

If you have one supply line in a given region or country, anything that affects their ability to fulfill their duties affects your ability to get your products to market. A diverse base of alternative primary and secondary suppliers can pitch in when your preferred supplier encounters problems.

4PL suppliers already have these relationships in place, so you’ll have quick access to other suppliers when you need them. This also applies when market demand changes, such as during your busy season, and you need extra bandwidth to augment the services of your primary supplier

Protection Against Cyber Threats

Modern supply chains are not just about the flow of goods, they’re also about the flow of data. Unfortunately, that makes your supply chain attractive to hackers who are sophisticated enough to identify the weakest spot in your cybersecurity, and breach your system with malware.

4PL suppliers understand that complex supply chains require detailed, coordinated security measures to protect the integrity of your technical infrastructure. They can proactively take the lead in addressing your cybersecurity policies and procedures by educating your team, optimizing processes, and ensuring your security software is up to date and meets your security needs.

They will also establish a common set of IT security standards between you and your suppliers, including codified policies and procedures and a disaster recovery plan. Engaging multiple parties in supply chain risk assessment will help you minimize cybersecurity risks arising from related dependencies and vulnerabilities.

Read MoreWhy a 4PL Solution is Essential for Your Cross-Border Supply Chain

Puts The Latest Tech To Work For You

A complex transportation management solution requires sophisticated software to give you full visibility into your supply chain. 4PL suppliers can provide a customized, easy-to-use TMS platform that allows you to optimize routing and loading, see your freight’s precise location at any given time, eliminate information silos, track inventory, and use business intelligence to give you real-time insights that help you make informed business decisions and further optimize your system.

4PL suppliers will be able to seamlessly integrate a robust TMS solution into your technical infrastructure, ensuring it syncs smoothly with many CRM, ERP (e.g., SAP, Oracle, QBO), telematics, financial, and customer service platforms via RESTful API or EDI, and built-in protection against data breaches.

Having the ability to predict and mitigate supply chain risk is crucial to maintaining overall business operations. One minor hiccup can impact product availability, revenue generation, and continued production. This is why the importance of having a supply chain optimized to quickly and efficiently handle disruptions when they occur cannot be overstated.

If you’re interested in learning how Cedric Millar can significantly transform your current supply chain into a more sustainable, flexible model, we’d love to chat with you. Just contact us at 1-888-998-1009 or via email at info@cedricmillar.com anytime for a no-obligation discussion.

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