The “Domino Effect” in Craft Production
As a manufacturer, your “premises” actually extends to every farm, kiln, and factory that feeds your production line. If a critical supplier goes offline (whether due to fire, flood, or machinery breakdown) your production schedule doesn’t just slow down; it stops.
What is Contingent Business Interruption (CBI)?
Contingent Business Interruption (CBI) is a specialised insurance extension that covers a business for lost revenue resulting from damage to a third-party supplier’s property. Unlike standard Business Interruption, CBI is triggered by damage outside your four walls.
Key Supply Chain Risks for 2026
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Single Points of Failure: Relying on a single source for proprietary glass moulds, specific yeast strains, or specialised labels.
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Utility Fragility: Regional outages impacting power, water, or CO2 supply.
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Logistics Bottlenecks: Delays at major Australian ports or within domestic freight networks.
3 Steps to Build a Resilient Supply Chain
1. Map Your Critical Dependencies
Conduct a “14-Day Audit.” Identify which three suppliers, if lost today, would halt your revenue within two weeks. For many Australian brewers, this is often the glass manufacturer or the maltster.
2. Evaluate “Unspecified” vs. “Specified” Cover
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Unspecified Suppliers Extension: Provides a general safety net (often 10% of your sum insured) for any supplier you haven’t named.
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Specified Suppliers: For your “Critical Three,” you should name them specifically on your policy. This removes low sub-limits and ensures the full strength of your policy is behind that relationship.
3. Address the “Customer” Side of the Equation
Risk isn’t just upstream. If your primary wholesale distributor or a major national liquor retailer suffers a catastrophic loss, your ability to move stock is compromised. A “Customers Extension” ensures your cash flow is protected even when your buyers are the ones in trouble.
Summary Checklist for Producers
| Feature | Importance | Action Item |
| CBI Extension | Critical | Verify “Suppliers & Customers” is on your schedule. |
| Sub-Limits | High | Ensure the dollar limit covers at least 3 months of turnover. |
| Public Utilities | Essential | Confirm cover includes off-site power/water failure. |
The Crafted Conclusion:
Resilience isn’t just about having a backup generator; it’s about having a policy that sees the whole map. In a “just-in-time” economy, your insurance needs to be as interconnected as your supply chain.
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