Firms urged to improve loss prevention standards and communication with suppliers
Supply chains are at risk because of companies trying to drive down costs, ACE Europe has warned.
Senior account engineer Phil Wall urged firms to consider increasing property and business interruption exposures within their supply chains.
He also called on companies to improve risk identification, loss prevention standards in supply chains, communication with suppliers, and alternative supplier arrangements.
A recent survey by ACE revealed that 60% of global business had negotiated lower prices with suppliers over the years.
Wall said: “While such measures represent short-term gains on the balance sheet, businesses need to … understand the additional longer-term exposures that may come with these. The failure of one supplier in a small chain or an incident in a large-scale warehouse creates very real and major risk exposures that could significantly damage a company.”