Trucks at Work

Forget the supply chain at your peril

It’s funny that, during all the blather associated with the Paris climate summit – and oh is there a lot of useless blather on this most political of subjects – there’s a new report out about how the growth plans of “clean technology” firms are being hampered by supply chain disruptions.

How about that: supply chains still matter, even though it seems more and more folks out there continue to take how goods are moved from one place to another for granted.

The latest realization of this most salient and unescapable fact comes courtesy of the 2015 Global Cleantech Risk Survey compiled by the Chubb Group of Insurance Companies and the advisory firm Cleantech Group.

That online survey of 300 clean tech executives worldwide unearthed some surprising findings. To wit:

  • Nearly two-thirds (61%) of clean tech companies experienced a supply chain disruption in the past three years, and in the vast majority of cases (84%) the event had a material impact on the bottom line.
  • Those supply chain disruptions resulted primarily in delayed deliveries (69%), erosion of profit margins (28%), brand/reputation damage (27%) and reduced revenue (26%).
  • Yet only 23% of those clean tech firms track product shipments and even fewer purchase insurance (11%) or ensure that suppliers have business interruption plans (11%).
  • Here’s the biggest whopper: Some 70% of clean tech companies do not have a written supply chain disruption plan.

“Clean tech companies continue to innovate and expand their global footprint to grow sales, reduce expenses and achieve other benefits – but sometimes without fully appreciating the potential risks," noted Sheeraz Haji, CEO of the Cleantech Group.

Is that an understatement or what? I mean, we’re taking about a world where cargo theft, border closures due to terrorism, bad weather, technological needs, and even ethics can negatively affect the ability to move freight either short or long distances – from state to state or halfway around the world.

Even if you are a “green firm” offering any number of “clean” technological solutions, be warned: you forget the tried and true strictures of supply operations at your own peril.

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