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Fire, flood and flu: How the first quarter of 2020 has affected supply chain

by Alastair Pennie

Graphic of a truck driving through a supply chain to delivery

It’s been an eventful start to the new decade in Australia, with many global and local events affecting nearly every industry. From fires in most states and territories affecting local transport which sees a direct domino effect onto the supply chain industry, to the outbreak of Coronavirus which has been disastrous for overseas stock.

Flooding the roads halts emergency supplies

Flooding has seen the closure of warehouses around the country with millions of dollars’ worth of stock being lost. The fires effected road closures around the country, limiting where trucks could go and sending the areas into chaos through the Christmas season.

The East Coast has continued to have extreme weather, with unseasonal rainstorms continuing to have flood waters rise then fall intermittently. The roads have been unpredictable in this time, and are making it difficult to guarantee deliveries arriving within any reasonable timeframe.

National bushfires and their long-term effects

Over the last six months, Australia has been burning, with the worst bushfires that the country has ever faced with over 18 million hectares destroyed. The environmental, social and economic impact that this has and will continue to have will be felt through the nation for a long time. Not only has the global headlines of the fires seen a drop in the tourism industry, on a local scale towns and communities have been cut off from civilisation as the fires were more damaging than was ever anticipated.

Coronavirus and the global problems

After the devastation of the weather settled, Coronavirus erupted, starting in China. At its peak, over 70% of manufacturing facilities in China were closed. Businesses are feeling the lack of stock, with the need to eat into the safety supply before they are run completely dry. Only recently, Australian hysteria kicked into overdrive as supermarkets around the nation were bought dry of all toilet paper, a pandemic no one ever expected.

Across the board, industries are feeling the sting of all the external factors that have ravaged the country and the globe. Supply chain in particular has had to reassess their way of operating and production lines as sources from China are cut off and roads around the country are closed due to the extreme weather.

The last time this sort of devastation was felt through supply chain was after the earthquakes that shook Japan in 2011. Almost nine years later it seems that some suppliers haven’t once again prepared for a rainy day. Risk management principles should be applied to cease the issues that continue to arise from the completely uncontrollable events of 2020 (so far).

 

I met a Supply Chain Director recently who had serious supply issue a few years ago due to a major supplier being affected by floods, he said “I’m never going to go through that again!” and his contingency plans created on the back of that have stood up to what Australia has thrown at him in the last quarter.

It is at these moments when a good supply chain comes into its own, so I hope your business is coping with the current turbulent climate. As recruiters, we are experiencing increased demand for interim and contract roles to cope with current challenges which is an area many businesses are starting to explore. We are also talking a lot about driving new talent into supply chain – surely now is the time to share how diverse and ever-changing supply chain is as a career and why it is a career path worth exploring.

 

Speak to our supply chain expert Alastair Pennie to find out more about jobs and talent.