We only become aware of a global supply chain’s complexity when it’s tested.
Ordinarily, each step contributes seamlessly towards the working of a well-oiled machine.
Today, however, supply chains are facing disruption at every step, and in some instances, those well-oiled machines are breaking down. 94% of Fortune 1000 companies are seeing supply chain disruptions from COVID-19(1). This breakdown is primarily illustrated by the soaring costs of goods. Between 2020 and 2021, the price of fabricated structural steel jumped by 64%, and imported sawn or planed wood saw a cost increase of 64.2%(2). The cost of logistics has also risen dramatically. In 2019 you would have paid approximately $2,500 to transport a 40-foot container from Shanghai to New York. Today, that price may be as much as $20,000, an estimated increase of 700% in just three years(3).
The bad news?
Gone are the days when you could renegotiate these costs to what they were pre-Covid-19.
The good news?
Taking a broad view of your supply chain can reveal plenty of changes you can make at each step to optimise efficiency and reduce unnecessary costs such as over-stocking articles, congestion at ports and administrative errors. Let’s oil up that machine and turn your supply chain pain into supply chain gain.
Download our latest insight to discover the Physical, Digital and Financial ways you can turn your supply chain pain, into supply chain gain.
(1)Accenture.com (2)Constructionnews.co.uk (3)Economist.com
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There are a number of different types of Supply Chain Disruptions, from Pandemics to Natural Disasters, to Inflation and Cyber Attacks. You must be proactive and prepare for all worst-case scenarios.
ESG risks in supply chains
Don’t forget, complex and bigger supply chains are prone to risks. More specifically, environmental, Social and Governance (ESG) issues can carry significant reputational and operational risks.
Traditional key considerations in supply chains include technical quality, cost effectiveness, speed of delivery and reliability. However, sustainability factors are increasingly gaining importance. Examples include:
- Environmental pollution
- Shortages of raw material and natural resources
- Workforce health and safety incidents
- Labour disputes
- Corruption and bribery
- Geopolitical considerations
Our industry specialists can work with you to enhance your long term strategy to protect against these risks. By proactively mitigating risks, you can spend more time focusing on growing your business.
Get in touch today for an initial conversation about working with ERA
For more than 25 years we’ve helped businesses generate sustainable cost savings whilst strengthening supply chains, resulting in long term resilience and growth. Contact us today and we can have a no obligation conversation to explain in more detail exactly how we can support you and the results we can deliver.