After each disruption, Australian boards buy dual sourcing, extra inventory or a second 3PL. Some of that is work. Some of it is a premium against a risk that was never written down. This note argues for naming the failure before funding the hedge.
We do not own a warehouse to fill with the buffer you did not need.
Name the failure before you buy the hedge
Our view is that Australian boards still buy resilience as a mood. Dual sourcing, extra inventory, a second 3PL, a second DC, a second port. Some of that is work. Some of it is a premium against a risk that was never written down. Start with the failure that would actually stop you. Single origin. Single Australian port. Single DC. Single carrier. Single SKU with no substitute. Then price the response. Dual ocean on a lane with spare capacity is cheap. A second DC for a regional brand is not. Mixing those two in a slide is how the wrong hedge gets funded with great confidence.
Inventory is a risk tool with a carrying cost. Buffer stock in the wrong node, or that cannot be picked, is not a buffer. It is rent plus a freight invoice. Write the failure, the signal you would see, the person who acts, and the cost of the hedge. If that page cannot be written, the hedge is a comfort purchase. If it can, you have the start of a program. We will help you write that page. We will not fill a shed with the buffer you did not need.
Concentration is not always a mistake
A single DC can be the right network. A single carrier can be the right contract. The mistake is not knowing what you would do if that single point failed on a Monday. Dual everything is not a strategy. It is a catalogue. LOGISTICS ADVISORY PTY LTD will tell you which concentration is a choice and which has simply not been examined. If you want a named failure list on your network, that is a risk file.