Events like natural disasters, and, most recently, the coronavirus, can disrupt your supply chain in an instant. But supply continuity is critical for building your products and delivering your services. Supplies range from the material goods you need to run your business to the services, utilities, and infrastructure your company needs.
If something disrupts your supply chain, you need a supply continuity plan to keep your business moving. A continuity plan details how you expect to source goods and materials when your usual supplier isn’t an option. It should also include how you intend to communicate your supply disruption and mitigate the impact on your revenue.
If you’ve found yourself in the midst of the coronavirus outbreak without a backup plan, you’re not alone. Follow these steps to develop a supply continuity plan and help keep your business running.
1. Identify how a supply disruption will impact operations and revenue
Before you determine how to move forward, you need to start with a clear picture. How will this disruption affect your ability to deliver products and services to your customers? How could it impact your revenue?
2. Consider sourcing goods from alternate suppliers
If you have backup suppliers, it’s a good time to ensure everything is in place to make the switch. If your backups are unavailable, or you don’t have backups to start with, consider expanding your view. Can you afford to source from a more expensive supplier until your preferred supply chain is back up and running? What local suppliers could you partner with?
3. Collaborate with other local businesses
If your supply chain is hurting, chances are other businesses in your area are feeling the same crunch. Look for local businesses to collaborate with during this time—and don’t rule out competitors! Work together to find creative solutions to keep your businesses afloat without the supplies you’d rely on normally. Is there a different product or service you could offer your customers while your supply is down? Could you leverage a partnership to keep revenue flowing?
4. Communicate, communicate, communicate
Above all, be upfront and honest about your supply continuity struggles. Build and implement a communication strategy to relay your business continuity plan with your employees, customers, and suppliers.
If you know you’re not going to have the supplies you need to serve your customers, let them know right away. Tell them what you’re doing to mitigate the impact and how they can support your business. And be transparent with your suppliers and vendors. They might have recommendations you can leverage while they get back on their feet.
The best time to plan was yesterday. The next best time is now.
In a perfect world, you had a foolproof plan, ready to implement as soon as your supply chain was disrupted. So you might feel caught off guard, but you’re not alone. Now is the time to leverage relationships, get creative, and lean on each other. Use this experience to build and strengthen your business continuity plan—and you won’t be caught off guard in the future.
This content is for information purposes only and information provided should not be considered legal, accounting or tax advice or a substitute for obtaining such advice specific to your business. Additional information and exceptions may apply. Applicable laws may vary by region. No assurance is given that the information is comprehensive in its coverage or that it is suitable in dealing with a customer’s particular situation. Intuit Inc. does it have any responsibility for updating or revising any information presented herein. Accordingly, the information provided should not be relied upon as a substitute for independent research. Intuit Inc. cannot warrant that the material contained herein will continue to be accurate, nor that it is completely free of errors when published. Readers should verify statements before relying on them.