Preparing For The Dark Clouds Looming Over The Supply Chain

Over the past two years, the increase in demand for products placed stress on the global supply chain exposing new constraints. Each day was filled with a surprise for business leaders, revealing issues for first-mile delivery that had previously been taken for granted.

Supply variability is the new normal. Variability is the highest in the history of supply chain management. In the last two years, traditional processes and technologies failed in the face of the challenge requiring greater dependency on ad-hoc manual processes. However, these two years are only a warm-up for what will come in the next thirty-sixty days.

Across the supply chain, dark clouds loom. China’s zero-Covid policy, the fallout from the Russian/Ukraine conflict, heightened inflationary pressures, pending recession, migration and resettlement due to political unrest and food insecurity top the list. While the pressure on North American ports is currently abated and logistics constraints eases, this is the calm before the storm. The issue for global supply chains is that raw material supply—either in warehouses or in transit within a country—is usually forty-five days. We are nearing the breaking point on materials.