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Supply chain disruption affects most retailers


Increasing problems with IT systems is a contributing factor to most retailers suffering from logistics delays this year, a new study has found.

A survey by the Business Continuity Institute (BCI) found that 70 per cent of organisations, questioned in a survey across 35 countries, reported at least one supply chain disruption in 2010.

Unplanned IT and telecommunication outages was the second most likely reason for delays, accounting for 35 per cent of all disruptions, up from 20 per cent in 2009.

Adverse weather was the most likely reason for supply chain problems, causing 53 per cent of all delays, an increase from 29 per cent last year.

The Supply Chain Resilience Report 2010 concluded: “Most organisations sit at some point between the polarities of ‘no risk at any price’ and ‘lowest cost at any risk’ but the survey indicates that business continuity is still overlooked in supply chain decisions.

“The findings also highlight that increased disruption is a reality not just a threat when pursuing such decisions, however the intelligent application of business continuity management can help support organisations take advantage of such supply chain optimisation techniques, as part of an overall enterprise-wide resilience strategy.”

On average companies reported five supply chain delays in the past 12 months but some organisations experienced over 50 incidents.

Though problems persist across supply chain operations, 50 per cent of companies polled have tried to optimise their businesses through outsourcing, consolidating suppliers or adopting lean manufacturing techniques.

The report also found that businesses which have shifted production to low cost countries have significantly increased their risks of supply chain disruptions, with 83 per cent experiencing problems.

Published on Friday 29 October by Editorial Assistant

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