If you operate a distribution business, you receive goods from domestic and/or foreign suppliers, warehouse them, and then sell and transport them to your niche market. Every business faces unique risks and should take steps to protect themselves. If you’re a distributor, you absolutely need an Orlando Distributor Insurance policy. You also should be aware of the most common risks faced by distributors so you can be proactive to prevent them from happening to your business.
Power Failure
Especially if you distribute perishable goods such as fruits and vegetables, dairy products, meats, ice, etc., a power failure can destroy your inventory and cause devastating supply-chain disruptions for your customers and huge financial losses for your business. Protect your inventory with alarm systems to signal power failures (this is especially important in the overnight hours, weekends, and holidays when employees aren’t there to notice the failure.) Also equip your facility with sufficient backup generators to operate freezers, refrigerators, air conditioners or other necessary climate control equipment.
Internal Theft
Distributors amass a huge inventory of goods. Crimes of opportunity are huge risks in this industry. According to the U.S. Chamber of Commerce, up to $400 billion is lost each year to employee theft. Make sure to conduct criminal background checks on all new hires (and re-check backgrounds periodically.) Also make sure to conduct internal and external audits regularly, and make sure all employees know about them. This sends a message that “big brother” is watching and that theft will not be tolerated. Annual physical audits are also important.
Goods-in-transit Accidents
Before you can distribute your goods, you’ve got to receive them safely and in good condition. No transport method is without its own inherent risks. Ships, airplanes, railroads, trucks … all can have accidents that destroy your goods.
Accidents Involving Fleet and Delivery Vehicles
Once your goods arrive safely to your facility, you’ve got to distribute them to customers. Make sure that all of your drivers are regularly subject to random drug and alcohol tests and motor vehicle record checks. Additionally, take steps to ensure your vehicles are safe and well maintained.
The distribution business is potentially very lucrative. Don’t let these risks derail your bottom line. Contact us at Hilb Group of Florida to secure a comprehensive insurance plan to protect your interests. Call us at (407) 859-3691 to get started!