Why this is a critical risk
If supply or a key component depends on a single supplier, its exit breaks the whole chain. A real case is in "What a day of downtime costs": a supplier's bankruptcy cost the company about 180,000 rubles per day of downtime.
What to prepare in advance
- A list of backup suppliers for critical items — with contacts and terms.
- Diversification: do not keep critical purchasing with a single counterparty.
- A stock of key items to cover the switchover period.
- A simple switchover procedure — who does what when the main supplier drops out (part of the BCP).
- Monitoring supplier health — early warning signs of trouble.
If the supplier is already gone
- Assess your stock and the horizon current resources will last.
- Activate backup suppliers from the list.
- Tell customers about timelines honestly — manage expectations.
- After stabilising — fix the backups in writing so you do not depend on one counterparty again.
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FAQ
How many backup suppliers do I need?
For each critical item it is advisable to have at least one vetted backup supplier and not keep more than a set share of purchasing with one counterparty.
How do I quickly gauge the scale of the problem when a supplier leaves?
Assess the stock of key items and how long it will last. That determines how much time you have to switch to a backup.
Evgeny Telenkov
Chief Risk Officer · PhD in Economics · "Best Risk Manager of Russia 2020"
20 years in risk management. Led risk management at Beeline, Nornickel, Rosneft and EY. Built business continuity plans for Nornickel, Rostec, NSD and DIA. Trained 300+ risk and BCM specialists.