The Cargo Theft Report has revealed that global theft from warehouses and storage facilities has risen to 30% in the past years, with more than half of the crime happening in Asia Pacific. India, Indonesia, China and Bangladesh had the greatest reported incidents of theft since the pandemic. Despite manufacturers and logistics companies looking for ways to reduce costs, many companies do not have sufficient preventive measures or response protocol against facility crimes until they become victims, resulting in severe financial and reputational damages. Criminals are also exploit and ‘profit’ from less resilient companies.
Inventories Bloat as Warehouse Expenses Climbs
Inflation, labor pressures, and political tensions are driving up logistic costs while inventories have grown excessively due to limited space. Energy and material prices have increased input costs for manufacturers which trickles down the supply chain. Port congestions also adds to the cost of warehouses as space decreases. Cargo at rest is particularly vulnerable to thieves, especially when it is left unattended.
Lack of Expertise & Scarcity of Labour
Businesses are lacking skilled and experienced workers to compensate for the reduced manpower since the pandemic. This situation is more crucial for manufacturers as data have shown a decrease of nearly 400,000 manufacturing jobs worldwide since the start of the pandemic. With less staff and more handling at each step, goods go through a longer process which provides more “opportunities” for criminals to take advantage of.
More Facilities Setting Up in APAC
APAC offers lower expenses and ample labor force as an attractive destination for businesses to establish manufacturing grounds. Many firms have revealed plans to diversify their production operations in countries such as Vietnam, Thailand, and India. This presents more ‘opportunities’ for thefts, especially new operations can often be ‘shaky’ with staff unfamiliar with the local environment.
Protect Cargo At Rest with Higher Levels of Facility Security
As facility risks continue and the possibility of new threats adding fuel to the fire, attaining TAPA’s Facility Security Requirement (FSR) Standards Certification becomes necessary for businesses to manage current risk environment and prepare for future disruptions. The need for higher facility security standards is especially critical for high value chains and facilities located in the APAC region.
“By achieving the higher resilience level through FSR, companies not only stand out from competition by achieving more than regulatory requirements, but more importantly, to reduce and prevent losses from the rising threat of facility thefts. This also helps to achieve long-term cost savings on insurance fees due to loss reduction and increased risk assessment effectiveness. Better usage and implementation of TAPA global incident reports and publications’ recommendations with TAPA FSR principles integrated into existing management systems will further support the company’s long-term performance”, said Mr. Alvin Lau, Executive Director (Greater China) at TAPA APAC.
The supply chain disruption is predicted to extend until 2024 or beyond – a troubling outlook for businesses and logistics managers. Many companies do not expect supply chains to return to normalcy within the next two years, as concluded by a latest CNBC survey. TAPA highly recommends manufacturers and warehouse operators to attain and upgrade the FSR Standards to ensure risk management effectiveness and business resilience.
