Distribution Channel Disruptions
Ok, the above image is using a bit of hyperbole. Hopefully, YOUR distribution channels won’t be disrupted by an actual comet crashing into the earth. But, there are definitely things that can disrupt your distribution channels!
If you’ve been reading along for the past few articles, you know that distribution channels are the networks of transportation methods by which your products get to their end users. You might be fully in control of these (direct distribution), but more likely if you have end customers around the world or even around your own country, you’re working with other retailers and/or wholesalers (indirect distribution) who will control parts of your distribution network.
So, it’s important to realize that you may not have full control over your distribution channels’ transportation methods. Still, it’s good to be aware of the possible disruptions to your distribution channels so that knowledge can inform your decisions when you DO have control.
And the types of disruptions fall into several broad categories.
Transportation-Related Distruptions
Transportation disruptions are probably the simplest to understand and predict: vehicle disrepair/maintenance downtime. Accidents. Delayed flights.
So for example, depending on your business and your customer base, you’ll want to consider whether you should partner with a more expensive transportation partner who has newer planes/trucks/etc and more spare parts to avoid transportation-related delays… or if your customers would prefer a cheaper shipping option, even if it means they might have to wait longer for your awesome products.
If you’re shipping internationally, transportation regulations can also come into play: do you need to allow extra time in your schedule for customs?
And transportation-related disruptions overlap considerably with…
Nature-Caused Distruptions
Now, you can’t predict all of these but some can be a little easier to anticipate than others. For example, if you’re shipping goods by air, that would typically mean you’re offering fast shipping and your customer is paying a higher price for that. Meaning, they need or at least want their product NOW and will be very annoyed if they have to wait a day or two. So if you’re shipping by air in the winter, you might want to anticipate snow storms. In the summer in certain places, thunder storms can similarly ground flights.
Princess Capybara enjoys thunder storms when she’s enjoying them from inside her apartment while enjoying a glass of wine…
Other nature-related disruptions include pest damage (during transit or warehousing), epidemics that disrupt distribution channels, and sometimes raw materials shortages. This last one is usually more of a supply-side problem, but it could factor into your distribution channels if, for example, there were a shortage of a material necessary to your packaging.
Then we come to the final and probably most difficult-to-predict category:
Human-Caused Disruptions
Yes, human-caused disruptions include things like riots, protests, strikes, and even wars.
When there is civil unrest in a region, your first reaction will probably be a human one, with sympathy for those are suffering and hope for peace…
But even if you’re a purely self-interested business person who cares about nothing other than your own distribution channels, you’ll still want peace because it will mean your products get delivered to your customers on time and with minimal damage.
Weekly Challenge:
Look through your own distribution channel networks and see if there are any disruptions you can predict and avoid!
