Supply Chain Shortage & What To Expect

The disturbance within the supply chain has caused massive delays in shipping, which has affected the supply and demand of products. Companies are seeing increased demand for their products, but many are struggling to keep up, which heavily contributes to the inflation of prices. As input costs rise, companies will be forced to increase prices to balance their losses. This pattern is repeated at each link in the supply chain and can play a huge role in the swing of demand.  

It is important for businesses to remember that the supply chain crisis is not going to last forever. This unfortunate situation provides an opportunity for every business that has or is being affected by this to be resilient and overcome these unusual issues. It allows them to reconsider disruption risks further and come up with new strategies to help avoid the next “supply chain crisis” from happening again. 

Some ideas may include multi-sourcing from different suppliers in diverse locations to spread risks and reduce risk impact. Also, prepare for the worst with risk management plans and share the responsibility with your partners. This allows everyone to be on the same page and aware of all the risks and measures that may need to be taken. Building backup inventory is another solution that will allow businesses to combat supply chain disruptions. Having this “safety” stock prevents stockouts and will allow your business to continue to operate, not only when there is a high demand from customers, but also with competitors that will need to refill their stock.