• Supply Chain

Protecting the Supply Chain from Robbery

Written by Robert Brice
April 26, 2016

Every link in a supply chain must be protected form theft.

Every link in a supply chain must be protected form theft.

While escalating political conflict and climate change cause severe problems for global supply chains, the danger posed by criminals targeting shipments should be a major concern of most industries, according to the British Standards Institution. A BSI group report found theft cost the global supply chain $22.6 billion in 2015.

As companies expand into new countries and criminals become smarter, the specific threats posed by theft shift. Companies should investigate data collection strategies to respond to new supply chain logistics management obstacles and security features to prevent businesses from looking like targets.

The Modern Form of Cargo Theft

While the billions of dollars lost to global supply chain theft is a great concern, domestically things look a little better. FreightWatch, a shipping management company, reported U.S. supply chain theft was down 7 percent between 2014 and 2015, according to The Wall Street Journal. Around the world, however, the amount of goods stolen during distribution is higher in South America and China. One thing these territories have in common with the U.S is the method by which criminals steal inventory.

Hijacking trucks seems to be the most popular way thieves intercept valuable goods in route for distribution. In 2015, there were multiple incidents of gangs threatening employees with violence or simply slipping into the driver’s seat of a vehicle left idling. Supply Chain Digest shared the results of a 2014 FreightWatch survey that found 90 percent of all cargo shipment thefts occurred when the truck was unattended.

Another trend reported by the multiple studies is thieves altering their targets from high-priced items to less-supervised products. Many criminals avoid pharmaceuticals and electronics because they can be tracked through serial numbers and other monitoring strategies. The 2015 FreightWatch survey found food and drink products were the most likely to be stolen, while home and garden merchandise was No. 2.

Protecting the Supply Chain

No matter the price of the cargo, a theft will cost a business. A Georgia Tech study found a single problem with the supply chain can cause a company’s stock to decrease by 8 percent, according to Bizjournals. When someone steals a shipment, the business not only loses the value of the product, but could dissuade a customer due to a late order and suffer from a number of other negative consequences.

Every industry needs to follow the example of high-end product distributors and create accountability procedures throughout the supply chain. Using barcode software, mobile data collection devices and other solutions, businesses can track check points throughout a distribution route. Tagging products, pallets and other assets with modern identifiers may dissuade criminals and allows companies to spot weaknesses in its current plans. When partners – particularly foreign ones – communicate through collected data, it prevents glossing over vulnerabilities due to miscommunication.

If truck drivers use mobile devices to report activities and check with managers, it should cause them to pay closer attention to their actions and account for their every movement. This commitment to visibility and supply chain security should be present at every level of a company.