Small Business
Business INSIGHTS e-News for Manufacturers
Protect Your Supply Chain From Natural Disasters
Read more e-News Articles by Category
- Business Management
- Supply Chain
- Industry Focus
Business Insights eNews
for Manufacturers
Get helpful articles like this sent automatically to your inbox every month.
Subscribe today
View Latest e-News  
PNC Webinar Series
Driving your Business: Fast Forward and Focused
Featuring Robert Herjavec, star of ABC's Shark Tank, Founder & CEO of The Herjavec Group
May 21st, 12:30 - 2:00pm ET
Register for our webcast and be automatically entered into our $25,000 Sweepstakes1 »

Business Insights
Quarterly Newsletter
Read, Download or Print -->

Take these steps to prevent storms or other events from crippling your business.

The Fukushima Nuclear Power Plant in Japan was reportedly built to withstand the impact of a moderate tsunami or earthquake. So why did it fail so spectacularly earlier this year? Because the disaster recovery plan didn't anticipate that both events might occur together, or that they might be stronger than envisioned. The resulting catastrophe halted the plant's ability to generate electricity and contaminated surrounding industrial sites. Around the world, automotive assembly lines were slowed or halted because key components were sourced only from the affected zone.

Companies can take several lessons from the crisis at Fukushima. One disaster can amplify another. Extremely unlikely events do happen. And disasters anywhere in the world may affect your supply chain. Here are a few ways to prepare for worst-case scenarios:

  • To assess potential effects on your supply chain, collect up-to-date contact information--including physical locations--for customers and suppliers. Store multiple copies, on computers and in print, both on and off site.
  • To protect your customers' needs, make reciprocal disaster agreements with trusted competitors and investigate alternate plant locations to keep supplies and product flowing.
  • In light of the globalization of supply networks, learn more about the countries your suppliers call home. Look into government and economic stability, geography and weather, currency strength and possible changes to taxes and duties.
  • Work with backup suppliers and shippers from time to time to maintain a relationship in case you need to call on them in a pinch.
  • Keep an emergency store of difficult-to-find parts, and house them off site for extra security.
  • Regularly review your insurance coverage. Contingent business-interruption coverage kicks in when your supplier's shut-down prevents your operation. Look over the terms carefully, though, since some policies are voided if your supplier's supplier is the one that's shut down, or if the cause is a flood or earthquake.

For more help in developing continuity plans, check out the Insurance Institute for Business & Home Safety's website ( for training materials, conferences and research.


The article you read was prepared for general information purposes by McMurry. These articles are for general information purposes only and are not intended to provide legal, tax, accounting or financial advice. PNC urges its customers to do independent research and to consult with financial and legal professionals before making any financial decisions.These articles may provide reference to Internet sites as a convenience to our readers. While PNC endeavors to provide resources that are reputable and safe, we cannot be held responsible for the information, products, or services obtained on such sites and will not be liable for any damages arising from your access to such sites. The content, accuracy, opinions expressed, and links provided by these resources are not investigated, verified, monitored or endorsed by PNC.