Risks in logistics and ways to minimize them

The current economic and political situation in the country, had a negative impact on all spheres of activity. Fluctuations in the currency market, “ate” almost 50% of the income of all without exception entrepreneurs. In this regard, many businesses had to face negative receivables arose, which led to a reduction in budgets and expenses, and some companies even had to cease operations. All these changes in the country had a significant impact on the logistics market, increased risks associated with this activity. I recall risk in logistics called deviation from the stated objectives, expected results, due to violation of the dynamic stability of the system of logistics enterprises to achieve optimal economic effect. That is, the risks in logistics combine different types of risks for all constituent units and elements in the process of material, financial and information flows, as well as during the actual management of the risks arising in the logistics system. Unfavorable situation or unsuccessful outcome in this can be: Loss of profits; loss or loss of equity; No result – no profit, no loss; loss of revenue or profits; event, which can lead to losses and lost income in the future.

Thus we can distinguish four main types of risks:

   1. Commercial risks directly related to the economic aspect of the enterprise (noncompliance partners, irrational purchases, supply disruption, violation of the terms of delivery, etc.).

   2. Economic and legal risks – with the advent of civil liability arising by reason of damage to natural or legal persons in the process of logistics activity.

   3. Technical risks – risks associated with the operation of technical equipment.

   4. Force majeure risks characterized completely unpredictable manifestations.

In order to avoid, or simply provide minimize the occurrence of risks to the enterprise, it is important to learn how to manage risk.

Risk management logistics system – a set of methods, functions and process steps logistic cycle, have been successfully used to prevent or reduce the risks to a minimum and ensure the sustainable operation and development of the logistics enterprise.

Basic and more common way to minimize the risks to which recourse as international carriers and carriers on domestic flights is insurance. But it should be borne in mind that no indemnity is unable to fully repair the damage caused by particular risk because apart from the direct, inevitable and consequential damages. Insurance compensation is not enough to fully repair the damage. Therefore, the task of logistics is to prevent the loss. Thus, the insurance system, which aims to ensure a high reliability of functioning logistics system management occupies a central place. This form of risk management is called risk management.

Risk management is a system of risk management and economic, rather, financial relations arising in the process of governance.

Job risk management today is a well-structured system. The structure includes:

1) Identification (identification) risk;

2) Risk Assessment;

3) Select the method and measures (instruments) risk management;

4) Prevention and control of risk;

5) Financing risk;

6) Evaluation of results.

All components of the risk management process, with all their differences and specificity, have sharply defined boundaries. They are closely related and each is not only defines, but the subordinate nature with respect to another component. Multistage logistics system presupposes a high level of potential risk.

Therefore, the logistics system should include a set of measures aimed at maintaining a high level of system reliability, which should reduce the likelihood of adverse events from the perspective of risk management to a minimum.