Multimodal transport strategies in supply chain management can mitigate risks related to counting on just one mode.
Having a robust supply chain strategy might make companies more resilient to supply-chain disruptions. There are two kinds of supply management issues: the first has to do with the supplier side, namely supplier selection, supplier relationship, supply planning, transportation and logistics. The second one deals with demand management dilemmas. They are dilemmas linked to product launch, manufacturer product line management, demand planning, product rates and advertising preparation. So, what common strategies can businesses adopt to enhance their power to sustain their operations when a major interruption hits? In accordance with a current study, two strategies are increasingly proving to work whenever a disruption takes place. The initial one is called a flexible supply base, and the second one is named economic supply incentives. Although a lot of in the industry would contend that sourcing from the single provider cuts expenses, it can cause dilemmas as demand fluctuates or in the case of an interruption. Therefore, relying on numerous vendors can offset the risk connected with sole sourcing. Having said that, economic supply incentives work if the buyer provides incentives to induce more companies to enter the marketplace. The buyer could have more flexibility this way by moving production among manufacturers, particularly in areas where there is a small number of manufacturers.
To avoid taking on costs, different businesses start thinking about alternative channels. For instance, as a result of long delays at major international ports in certain African countries, some businesses encourage shippers to build up new routes along with old-fashioned tracks. This plan identifies and utilises other lesser-used ports. Instead of counting on just one major port, once the delivery company notice heavy traffic, they redirect items to more efficient ports across the coastline and then transport them inland via rail or road. Based on maritime experts, this tactic has its own benefits not only in relieving stress on overrun hubs, but additionally in the financial development of growing regions. Business leaders like AD Ports Group CEO would probably agree with this view.
In supply chain management, disruption within a route of a given transport mode can dramatically affect the whole supply chain and, often times, even take it to a halt. As a result, company leaders like P&O Ferries CEO and Maersk CEO work hard to add flexibility into the mode of transport they rely on in a proactive way. For example, some companies utilise a flexible logistics strategy that depends on multiple modes of transport. They urge their logistic partners to diversify their mode of transport to include all modes: trucks, trains, motorcycles, bicycles, vessels and even helicopters. Investing in multimodal transportation methods like a combination of rail, road and maritime transport and even considering various geographical entry points minimises the vulnerabilities and risks related to depending on one mode.