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Inventory Management

Jul 22, 2021

3 Steps to Warehouse Contingency Planning for Future Crises

Warehouse contingency planning has never been more important than it is now post-COVID. Here’s how to start developing yours.

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The supply chain has always been vulnerable, but COVID helped to uncover just how impactful its weaknesses can be. Those who had previously made warehouse contingency planning a priority before the pandemic were likely better able to navigate its challenges.

To be fair, a crisis in the supply chain can happen at any time and on any scale. It could take the form of a global disruption. Or, it might be a localized issue like a wildfire in California or a hurricane on the Gulf Coast.

Regardless of the timing and scope of the issue, business continuity becomes your top priority. A warehouse contingency plan can help you minimize disruptions and carry on like normal. Here are our suggestions for developing your contingency plan.

1. Conduct an Initial Risk Assessment

You can’t plan for risks you don’t realize are possible. That’s why every warehouse contingency plan begins with a risk assessment.

This is your opportunity to take stock (pun intended!) of all of your business-critical processes, technologies, procedures, and people. How are these items vulnerable? What will it take to preserve these things in a moment of crisis?

Think about worst-case scenarios and how these scenarios could impact your operations. For example, if your facility were to burn down, how would you go about receiving new shipments in a temporary space?

Or how about if we find ourselves in the midst of another pandemic? How could you improve social distancing between workers or enforce things like handwashing or temperature checks in the future?

Another area of risk to consider is any change in regulatory compliance. Warehouse operators are subject to compliance requirements like many other industries. This might be along the lines of proper food or chemical storage, lockout/tagout procedures, or even how you manage your customers’ data. Your warehouse contingency planning should include ways to stay up-to-date on any changes in compliance as well as processes to handle audits, complaints, or requests for information.

2. Outline Your Plan for Each Possible Scenario

Take the risks you uncovered in your risk assessment and start thinking about ways you can keep business going when those risks arise.

For many warehouses, this can be a huge undertaking. The risks are plentiful, some of which are more likely to happen than others.

One approach to break your warehouse contingency planning into smaller chunks is to tackle the most impactful risks first. These are the ones that are most threatening to business continuity or most likely to occur.

Another way to approach this process is to think about broad solutions that address a number of risks simultaneously.

For example, centralizing all of your processes and data and moving to the cloud can help keep business going regardless of physical limitations. You’re no longer dependent on internal local servers, hardware, and paper records and can access important information on demand. Plus, if you have to temporarily move to a new location, cloud data easily travels with you.

As you’re outlining the steps to take with each contingency plan, you’ll want to include the following details:

  • What trigger(s) will set your plan in motion?
  • How should each person in your warehouse respond to the plan (what is their role)?
  • What is the timeline for each step in your contingency plan to take place?
  • Do you have extra labor or other resources available to help you carry out your plan?
  • What technology systems will you rely on to carry out your plan?

Evacuation routes, security protocols, payroll, and alternative work schedules and arrangements should also be included in this step.

3. Communicate Your Warehouse Contingency Planning

As warehouse leaders establish their contingency plans, it’s important to communicate these plans with your team. They need to know how to respond in a given situation, and they deserve the confidence of knowing how the company will have their best interests in mind in the event of an emergency.

Communicating your plan doesn’t necessarily mean giving each employee the full rundown on every possible scenario. Instead, you might opt for a “Cliff’s Notes” version and share specific details as they relate to the employee’s role. Your senior leaders will need a fuller picture of your contingency plans compared to a worker who only picks and packs orders, for example.

Depending on the hierarchy of your business, you might rely on senior leaders to trickle down communications to hourly workers and temps. These expectations should be clearly defined in your plan so that no important detail slips through the cracks in a critical moment.

In addition, it’s a good idea to create warehouse contingency planning resources and make them available to employees. For example, you might have a separate handbook in your main office that employees can access.

Making Zenventory Part of Your Warehouse Contingency Planning

We can look to the past to learn how to better weather previous storms. But the fact remains that life sometimes throws even the most prepared warehouses a curveball they weren’t expecting.

Making warehouse contingency planning a priority might not prepare you for every possible scenario. But it can help you start thinking about ways to reduce your risk and tighten any gaps that might impact your business.

Zenventory’s comprehensive warehouse management platform contributes to a robust contingency plan. Warehouses can rely on a single integrated system for inventory management, reporting, QuickBooks, shipping, and more while also integrating with popular online marketplaces and shipping partners.

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