Supply chain risk management

Okay, so imagine you have a big toy factory that makes lots of toys. You need different things to make these toys, like plastic and paint. These things all come from different places and people called suppliers.

Now, sometimes these suppliers might not be able to give you the things you need. For example, maybe there's a big storm and it's hard to get the plastic because the trucks can't drive.

This is called a supply chain risk. It means that something unpredictable has happened and it might stop you from making your toys.

But you don't want that to happen, right? You want to be able to keep making your toys no matter what. So, what can you do?

You can plan ahead and think about what could go wrong. This is called supply chain risk management.

For example, you could find more than one supplier for each thing you need. That way, if one supplier can't give you what you need, you have another one who can.

Or, you could have extra toys in storage, just in case you can't make more for a while.

Basically, supply chain risk management is when you make plans to make sure that you can keep making your toys even if something unexpected happens with your suppliers.