Natural Disasters in SA Supply Chain

With natural disasters seemingly on the rise, shipping has been affected as well. The recent natural disasters in Australia, Japan and New Zealand have demonstrated the global impact of such incidents on shipping, sourcing and supply chains. The unpredictability of these natural disasters has called for a more holistic approach to supply chain risk mitigation for both shippers and logistic service providers.

When looking at the top ten supply chain risk factors facing business, South Africa is more aligned with the problems which developing economics face rather than natural disasters. Of the factors that influence the SA supply chain the most common are running out of cash, a sudden drop in demand, disruption of internal operations and communication problems with vendors. Although these factors are crucial problems within the supply chain, it does not compare with the devastation of natural disasters. Shipping agents in Cape Town and other harbours in South Africa have one reason to be grateful that they are part of a developing economy.

A loss in electricity is five times more likely to occur in South Africa than in the rest of the world and employee theft four times for likely. However, these are factors which are caused mainly by human error and can therefore be corrected. World natural disasters on the other hand are unpredictable and unstoppable. However, Sea fright in Cape Town could be affected by natural disasters to some degree. Japan is a big importer of products like steel and cooking oil which could affect SA exports. Supply chains have become more vulnerable because of globalisation and trading with regions, different languages and which are involved with different risks. South African natural disasters might not be a problem and therefore the supply chain needs to shape up on service delivery and align its strategies to the holistic context.