Back up supplier – why do you need one?
enter site Many importers do not adequately protect their supply chain by having a back up factory. Only when it’s too late and their current supplier doesn’t deliver, do they realize the importance of this safety guard.
http://rfsarchitects.com/projects/industrial/ Having a back up factory is critical to import success. There are many factors that can impact a supply chain and not all of them are within the control of your manufacturer. These include problems like;
http://lakesiderestaurantcumberland.com/menu-card-cat/lakeside-platters/ • labour shortages;
• equipment failure;
• electricity outages;
• logistics problems;
• adverse weather conditions, or even
• materials shortages
All of these problems can potentially impact supply lead times or even delivery.
We had a case once where the electricity was shut down in the area where one of our client’s factories was based. The manufacturer had to literally relocate their equipment 20km down the road to gain access to power and continue production.
Fortunately their equipment was not complicated and the relocation was possible, however it did cause delays and the Australian customer had no choice but to wait.
To circumvent this situation, it’s a good idea to look at sourcing a secondary or back up factory. This means finding another factory that can make similar products and then putting them through the process of sampling and testing to the point where you have a comparable product. In this way, if your primary supplier has a problem, you can fall back on your secondary supplier. Actually going through this process is a good practice to ensure you are also getting the best prices and staying abreast of new developments.
Doing this takes time, costs money and requires care to ensure you are protecting your intellectual property. It is however an essential activity for import success.