03.26.08

The Olympics: Is the Third Time the Charm???

Posted in B2B Outsourcing, Compliance, Logistics, B2B, Supply Chain at 1:53 pm by Bryan Larkin

This is my third entry regarding the Olympics.  But will it be my last?If you haven’t worked out what you need to regarding the Olympics with your Chinese suppliers by now, it appears it is too late.  Smart carriers have been working with their contacts to secure their capabilities during the Olympics. But factories across several provinces in China will be shut down for some time in order to help clear the air for the athletes and guests at the Olympics (seems normal business travelers, tourists and residents don’t measure up to deserving similar consideration!).    So, you might have shipping capacity, but nothing to ship.

Official word – if any – won’t come from Chinese authorities until sometime in April, but companies on the ball have been working this issue for a year or more.  Some need to carry safety stock.  Some have had to move production to other areas (either within China or outside of it).   Those that have not had the foresight, or been given good advice from their carriers and suppliers, will face delays and probably shortages.  Will some of manufacturing that has been shifted stay in its new facility permanently?  Perhaps.  This is an opportunity for other manufacturers to step up to the plate and show what they can do as a strategic partner, not just an overflow or backup provider.

But shifting production – even for a short time – means the potential for significant issues around order-to-settlement.  Will you be able to use the same carriers?  If you were automated, will you need to shift to manual orders/invoices during this time?  If so, are you staffed at home to address this unusual business problem?  What will this do to your reporting?  Are your auditing procedures ready to account for these manual processes in an otherwise automated supply chain?

Lots of questions here that go beyond availability, but most likely it is the availability you are worried about, now.  There will be time to address the other things later.  Right?

Leave a Comment

You must be logged in to post a comment.