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How Severe Weather and Natural Disasters Disrupt Logistics

Minimize the Impact of Disruptive Weather Patterns

When it comes to climate patterns, nobody can truly foresee the damage that severe weather and natural disasters can inflict – especially when it comes to importing and exporting goods. Thankfully, there are a number of steps you can follow to help your business prepare for the worst, or better yet, plan for how to proceed during an emergency weather situation.

Assessing Weather and Disaster Risks

The UNSIDR (United Nations International Strategy for Disaster Reduction) defines a disaster as “a serious disruption of the functioning of a community or a society at any scale due to hazardous events interacting with conditions of exposure, vulnerability, and capacity, leading to one or more of the following: human, material, economic and environmental losses and impacts.”

In layman’s terms, this means any devastating incident that disrupts everyday operation in any given area that cannot be resolved with local resources alone.

These disasters can occur due to a number of reasons, including geographical, meteorological, climatic, biological, hydrological, or even space-related. In most cases, a severe weather occurrence or a natural disaster will include disasters from numerous categories, such as a hurricane with severe flooding or heat waves with tornados. In any case, it is important to have systems in place that can be activated in case of one of these events.

Severe weather has been known to affect logistics, as well, with global supply chain management disruptions rising 29% since 2012. According to the 2017 Global Risks Report, extreme weather is considered a top risk. This may also be due in part to companies’ failure to properly prepare for the threat associated with severe weather warnings. TheStreet reports trucking companies in the United States lose an estimated $2.2 to $3.5 million annually because of weather delays. That’s a lot of money!

So what can you do to help your business be protected and prepared when severe weather or a natural disaster strikes? Discuss a plan of action.

Create a Contingency Plan

While there is very little you can do to sway the weather, you can take steps to ensure your import or export business doesn’t suffer too greatly from delays or damage. Take the time to develop a course of action that you and your employees should refer to in the event of a disaster or severe weather conditions. This arrangement is typically known as a disaster risk management plan. Here are some tips when creating your risk management plan that can help to minimize disruptions in your services.

  • Assess the Risk. While it is impossible to always plan for weather accurately, you can absolutely do your part to stay on top of potential impacts, like tornado, hurricane, or flood warnings by your local meteorologists. Determine where the risk is coming and what part of your logistics will be affected. Be aware of various threats and risks and have multiple ways to move forward in lieu of them.
  • Prepare in Advance. You should never wait until a disaster strikes to attempt to collect the supplies or materials you need. Instead, accumulate extra fuel, parts, equipment, and any necessary items ahead of time. You can always make additional preparations in light of any potential risks. For example, having copies of any important data either in the cloud or stored at an off-site location can help in the event of physical damage to your location.
  • Discuss a Plan of Action. The mitigation process will essentially decide how your company reacts to a natural disaster or unexpected weather. How will you communicate with employees if cell towers are down? How will you notify your customers of potential delays or complications? Will your supplier or your shipments be affected? Ask yourself questions that you may have to consider in a disaster situation so your operations don’t suffer.
  • Response and Recovery. Once the situation has been resolved or the disaster has been addressed, you will need to go into a recovery response mode. This means repairing any issues or services that have been impaired, doing any necessary damage control, and trying to maintain as many operational systems as possible. This process may involve repairs, especially if you have been personally affected by dangerous weather conditions. Consider the most cost-effective way to get your company up and running at its full capacity again as quickly and efficiently as possible.

Protect Yourself With Premier Logistics Services

At Promptus LLC, we are a multi-industry logistics company that works with a number of importers and exporters all over the globe. This requires us to stay on top of weather patterns in various areas throughout the world and to have multiple disaster management plans in place in the event that weather catastrophe occurs unexpectedly.

For the 15 years we have been in service, we have made it a point to employ the most advanced technology available to maximize efficiency for both our clients and us. Our headquarters are located in Miramar, FL, an area prone to hurricanes, so we are well experienced and wholly prepared to withstand powerful nature storms and weather disasters. We have plans of action in place to help minimize the risk of damage during weather emergencies. Call us today to get your free freight forwarding quote!

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Invest in Cargo Insurance Now and Save Immensely Later

Discover How Cargo Insurance Can Prevent Headaches and Costly Fees

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When it comes down to importing or exporting goods, regardless if you are using air, ocean, or ground freight forwarding services, you may consider investing in cargo insurance. Legally, carriers must provide a standard amount of insurance coverage, known as carrier liability. Many companies question whether the choice for cargo insurance is truly worth it but here at Promptus, we always recommend all importers or exporters purchase some form of insurance to protect their cargo.

This is because carrier liability only offers limited coverage – typically the bare minimum. In the event of an emergency or accident, you may find yourself shelling out funds to cover lost goods, even if you aren’t at fault.

What To Understand About Cargo Insurance

One of the biggest mistakes made in shipping cargo is assuming the other party took the steps to insure the shipment. Unfortunately, in most cases, this results in no coverage being requested and in the event of a mishap, someone will have to pay hefty costs.

It is vital to know who will be requesting additional insurance coverage on your goods. If it is the shipper or the manufacturer, be sure to confirm their insurance arrangement prior to committing to the contract. With some foreign exporters, they may be using an insurance company from their own country, which means following their rules. Be aware of all the options before moving forward, and remember that having a US-based insurance company could go a long way if it comes down to filing claims thanks to US insurance laws. Thankfully, various options can be explored.

Take Care of Your Merchandise

Insurance is beneficial for a number of different reasons. Obviously, the reason for a coverage plan is to protect your assets in the event that your goods or the carrier are lost, destroyed, or damaged. This can end up protecting parties on various ends, in many cases.

For example, if you are a shipper who has shipped but hasn’t received funds or a buyer who has paid but hasn’t yet received the goods and an unexpected tornado or natural disaster strikes, causing unavoidable destruction to the entire carrier’s cargo load. By the traditional liability coverage, the carrier would not be required to pay out, nor would the shipper. This leaves both parties inadvertently in trouble. However, if one (or both) of the parties had a more full-coverage insurance policy in place for this shipment, their insurance would kick in and provide them with a payout to help cover any losses. Sounds great, right?

It is! Assuming you have the right coverage. That’s another important factor to consider: purchasing the right insurance plan for your business’ needs. Whether you require an all-risk policy or a named perils policy will depend on if you want to guarantee costs for the widest range of possible losses or if you only wish to protect against certain type of loss.

  • An all-risk policy will cover everything, except anything specifically excluded in the contract or policy. This type of insurance is typically more expensive, but offers more comprehensive coverage options.
  • A named peril policy will only cover what is specifically included in the policy. This means if something perilous happens, such as a vandalism or robbery, but you only have natural disaster protection, you will not be covered.

Expert Logistics Services in Miramar, FL

At Promptus LLC, our freight forwarding services are fully insured and offer clients various levels of coverage to suit their particular needs. When you go through a 3PL or third-party logistics team, you gain access to our extensive array of resources, including insurance options. As a large company, we get better deals on insurance prices to cover all of our air, ground, and ocean shipping options. This means cheaper rates for our customers as well! Contact us today to get a quote on all your global logistics needs.

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