Question
Examine the impact of Global Supply Chain risks. Discuss how a retailer can build a "Resilient Supply Chain" to handle unexpected disruptions like natural disasters, trade wars, or shipping lane blockages. Provide strategies for risk mitigation.
Answer :
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Global supply chain risks have become a major challenge for retailers because modern retail depends on interconnected suppliers, manufacturers, transport networks, warehouses, technology systems, and international markets. A disruption at any point can affect product availability, delivery time, operating costs, and customer satisfaction. Natural disasters such as floods, earthquakes, cyclones, and pandemics can damage factories, warehouses, roads, ports, and communication systems. Trade wars and changes in tariffs, sanctions, import restrictions, and customs regulations can increase procurement costs and delay international shipments. Similarly, shipping lane blockages caused by accidents, geopolitical conflicts, or congestion can interrupt the movement of goods and create serious shortages. The impact of such risks can be extensive. Retailers may experience stock-outs, excess inventory, rising transportation and procurement costs, production delays, and loss of sales. Uncertainty in supply can also make demand forecasting difficult. When products are unavailable, customers may shift to competitors, resulting in loss of loyalty and
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