Top ten threats to logistics: capacity

Top ten threats to logistics: capacity

Continuing with our ‘top 10 biggest threats to logistics’ as given by industry experts, this week we’re looking at capacity. 

During the Supply Chain Risk Management and Mitigation Workshop F&L Conference in Gothenburg in May last year, the audience were asked from their own business perspective, what they thought were the biggest threats to the supply chain. 

Capacity Management  

Capacity is deemed a risk where the company have limited capacity to increase production, deliver within tight timescales, seek out additional business, source additional transport for orders awaiting dispatch or any number of other issues.

Good communications are fundamental to finding solutions. This is relevant to both internal and external communications. Understanding the capacity of other parts of the business to react to changes in one area or another and what the impact will be if for example production schedules change on warehousing or transport capacity to take the increased production. Additional capacity is wasted resources, vehicles travelling with less than full loads, warehouses with unused space and staff not being fully engaged during the working shift are inefficient and costly.

Communications regarding planned changes in production schedules, business development plans, increases in product ranges or considerations of transport capacity or changes in contractual arrangements need to be considered and discussed widely to ensure no negative impacts on other business areas.



Another threat to logistics is not having the capacity to up-scale. Most companies are keen to up-scale operations but there are a number of issues that should be considered before embarking on expansion plans. Any current issues in production or supply chain should be resolved before instigating plans as additional pressures mean that kinks, rather than resolving themselves, will tend to become more exposed and more difficult to resolve.

Have a clear plan on who the target customers are and ensure that staff, including management teams, and your suppliers can meet the increased demand. As much as possible, be clear on the level of customer and market demand for the product in order that the increased production is meeting demand rather than trying to generate it. Products need to be competitively priced but historically, to compete on price alone, has been shown not to be the sensible approach.

Most success comes from quality, ingenuity and customer service. Up-scaling is often associated with increases in staff numbers and roles. In some cases, actually trimming the number of staff may be the smart way to progress as staff and department roles are overtaken in some areas or become redundant due to for example automation.

Top Ten Threats to Logistics

Threat 1 – Insider Threat

Threat 2 - Theft

Threat 3 – Unexpected Incidents

Threat 4 – Terrorism

Threat 5 - Reputational Damage 

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