Tag - coronavirus

Encompass Response to Coronavirus

Updated March 30, 2020

Message from Encompass President & CEO Robert Coolidge

Encompass has been closely monitoring the global impact of the coronavirus (COVID-19) pandemic since it first originated in China. Our heartfelt condolences are with all those who have been sickened and died from this terrible illness. Please click here for a helpful pamphlet on Preventing the Spread of Respiratory Diseases from the Center for Disease Control and Prevention.

Internal Response

Although all Encompass facilities are operating regular schedules, we have taken several precautions for the health and well-being of both our associates and business partners. We are following all government guidance and mandates to help contain the pandemic. Some measures we have taken include:

  • Office staff are telecommuting until further notice. Encompass is equipped with cloud-based systems, ensuring continuous communications both internally and with our customers. 
  • Essential on-site staff are provided antiseptic wipes and hand sanitizer at work stations and common areas, but more importantly, they are mandated to frequently wash hands.
  • Warehouse teams are wearing gloves when handling packages.
  • Guests are prohibited from visiting our facilities, and staff travel is restricted.

Parts Supply Continuity

Due to the expected closings of factories during the January Chinese New Year, our Purchasing team had procured safety stock for the select brands for which we source directly overseas. At this time, highest demand parts remain in stock across multiple product verticals, including Home Appliance and Consumer Electronics. However, the team is in daily contact with manufacturers to identify any supply disruptions so we can then communicate with our customers.

Encompass has no immediate plans to close facilities and will continue to follow standard preventative guidelines to address the current situation. Please note, however, that while we all work to contain the COVID-19, Encompass is suspending counter pickup service effective March 18, 2020 until further notice. Ground and expedited shipping options are still available for orders placed on encompass.com and through our Call Center: 800.432.8542.

We appreciate your patience and understanding during this difficult time. If we can be of any assistance, please let us know: customercare@encompass.com. Encompass will continue to update this company response statement as conditions warrant to keep you informed.

Robert Coolidge
President & CEO

 

 

Planning for Unexpected Supply Chain Disruptions

 Hurricanes in the Southeast. Blizzards in the Northeast. Tornadoes in the Midwest. Earthquakes and fires in the West. Natural disasters occur often and mostly without time for planning. Major transportation carriers and routes are usually impacted, which has an immediate, but mostly brief, effect on supply chain continuity.

But what about supply chain disruptions occurring continents away? As the world’s largest manufacturing country, China plays an extremely important role in U.S. commerce. When something momentous happens – like the coronavirus (or COVID-19) or the once looming trade war with the U.S. – effects typically domino across the globe.

Although it’s still somewhat early days, the COVID-19 crisis is already having a major impact on global trade and logistics with Chinese factory closings, workforce quarantines and transportation disruptions. The electronics industry is at particular risk with Shenzhen, a major hub of electronics and parts manufacturing, located about 700 miles from the epicenter of the virus outbreak. While some manufacturing factories have reopened, thousands of workers remain under quarantine or otherwise unable to travel to work.

The situation is mitigated somewhat by the fact that the initial outbreak coincided with the Chinese New Year during which most businesses shut down for about 10 days. Distributors like Encompass typically anticipate this downtime and plan accordingly to purchase extra safety stock. The question becomes whether the additional inventory will keep pace with demand until business returns to normal in China.

Current fulfillment lead times from Chinese factories are 30 days or more, so even the slightest delays could significantly affect supply and complicate purchasing strategies. What can supply chain managers do to try to limit the impact of global supply chain challenges – particularly those affecting the world’s largest manufacturing cluster? This is probably one of the hottest topics of discussion occurring in U.S. board rooms and purchasing departments across the country.

Whether your business is directly affected or not by the current crisis, it’s still an opportunity to review your purchasing strategy. Identify any weaknesses and determine contingencies as part of your overall purchasing strategy going forward. Here are some areas of consideration:

  • Sourcing Partners – Are all your supply sources in one basket – be it a single factory or geographic region? Assess the impact level to your business and customers of any unexpected, potentially lengthy supply disruptions from this source. Just like your financial portfolio, diversification is good. Consider alternatives for a backup supply pipeline in a different geographic area to help mitigate the risk of being cut off from your primary source without warning. For repair service businesses, this can be as simple as establishing accounts with multiple parts vendors for seamless transition if ever necessary. 
  • Safety Stock – Do you stock enough inventory to meet demand for an extended period of time? While purchasing managers are constantly pressured to keep inventory turning, it may be worth stocking at least some high-demand SKUs beyond ordinary levels — particularly if your business is at risk from limited supply sources.
  • Business Continuity Plan – Many business continuity plans are focused internally on steps a company will take to recover from its own unforeseen events. Downstream disruptions in the supply chain should be included in your overall business continuity strategy.  And put the onus on your sourcing partners to provide their detailed plan for business recovery.

While the U.S. and China have reached a trade agreement and COVID-19 is likely to be contained sooner than later, the risk of future impactful events remains as certain as ever.  Don’t forget COVID-19 is not without precedence; in the early 2000s it was the SARS epidemic wreaking havoc on global trade. Sadly, chances are pretty good this isn’t the last time we’ll be dealing with supply chain disruptions, but ensuring you have a Plan B should help minimize harmful consequences to your business and customers.

Regardless of any business impact, we can’t forget that at the core of this epidemic are human lives. Compared to so many people dying, delays in receiving the next generation smart phone seem meaningless.  Above all, we should be focusing on joining together to help all those affected through this horrific ordeal.