The supply chain is in a constant state of disruption. As we discussed on Supply Chain Chats, simple backup plans are no longer enough. In fact, you can look at recent events and determine if a backup is sufficient. Starting with the pandemic, of course, most if not all companies didn't have a sufficient enough backup plan.
According to The California Policy Center, 237 companies have left California since 2005. Most companies cited the expanding regulatory and taxation environment.
The aerospace supply chain has been struggling to recover since the pandemic. The industry has been plagued with shortages, labor issues, and supply chain issues. According to McKinsey, demand was back to 97% of pre-pandemic levels as of December 2023.
COVID-19 may no longer be a significant public health threat, but the global supply chain remains chock full of risk. The threats are seemingly everywhere these days: The Israel-Hamas war, which is sabotaging trade routes in the Red Sea; extreme drought, which is curtailing shipping in the Panama Canal, and China’s military aggression, which is threatening lawful commerce in the South China Sea.
In this episode of Supply Chain Chats, Lisa Anderson talks about the state of affairs in the global supply chain. From the drought impacting container ship capacity in the Panama Canal to the Iran-backed Houthi rebels attacking container ships in the Suez Canal to the Chinese aggression towards Taiwan and ships passing in the South China Seas, risks are increasing across the global supply chain.
California's minimum wage went up to $20/hr. for fast food restaurants with at least 60 locations nationwide that do not make bread. This law is causing widespread unintended consequences. For example, Fosters Freeze in Lemoore closed suddenly after the wage hike. Mod 5 Pizza is closing five locations.
Lisa Anderson emphasizes the profound and wide-ranging impacts on global supply chains. The bridge’s destruction not only disrupts local traffic and logistics but also sends shockwaves through international trade routes, highlighting the critical need for robust supply chain resilience strategies.
Horribly, a container ship collided with the Francis Scott Key Bridge, and much of the bridge collapsed. From a supply chain point of view, it has caused significant near-term impacts and extended disruptions in the region.
Manufacturers wish they left supply chain shortages behind after the pandemic, but they remain top of mind. Concerns remain. According to KPMG, “71% of global companies highlight raw material costs as their number one supply chain threat for 2023.”
In this episode of Interlinks, we delve into the heart of navigating through the unpredictable tides of global events and their profound impact on supply chains, discussing the imperative need for agility and resilience.
