The 2021 global supply chain crisis has the entire business world concerned. Nearly 66% of consumers believe that there’s no end to this crisis, while 82% of people think that this problem will ruin their life plans, like vacations, holidays, and consumption of various products. According to various expert reports, 87% of Americans were hurt financially, business-wise, and as consumers because of the supply chain shortages.
So, what exactly happened to the world’s supply chain, and how is it doing right now?
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What Caused the Global Supply Chain Crisis and What’s Its Condition At Present?
What Caused the Global Supply Chain Crisis: Top Russian exports like crude petroleum, refined petroleum, and petroleum gas are no longer available to several countries because of the sanctions.
The COVID-19 pandemic led to the global supply chain crisis. Before the pandemic, less than 50% of consumers were concerned about the supply chain. They didn’t care much about where their products were coming from or under what conditions they were being manufactured. After the recent pandemic and the ongoing supply chain crisis, 91% of consumers are concerned about the same.
However, the situation with the pandemic is much better now. Even then, the crisis is still present. That’s because of the ongoing war in Ukraine.
The war between Russia and Ukraine has had a major impact on global supply chains. Due to the conflict, many companies have been forced to reroute their shipments, which has resulted in massive delays.
This is especially true for companies that rely on sea transport as opposed to land-based transportation. In fact, many businesses have had to completely change their supply chain processes because of this conflict.
A good example of how this war is impacting supply is the case with Apple’s iPhone SE. Apple is now going to make 20% fewer iPhone SEs than what it had originally planned on doing in 2022’s second quarter. Like Apple, many other businesses have either had to decrease production or put a halt on it entirely.
Sanctions imposed on Russia are also affecting the supply chain, as well as the global economy. Top Russian exports like crude petroleum, refined petroleum, and petroleum gas are no longer available to several countries because of the sanctions. So, not only is the war affecting the supply chain, but it’s also pushing the world towards an energy crisis.
How Businesses Can Tackle the Supply Chain Crisis in 2022
Business must go on as usual, even when the world is dealing with one of the biggest supply chain crises of all time. So, they must know how to tackle this crisis, and here’s how.
Track Your Stock
Tracking your stock is one of the first things that you should do to prepare for a supply chain crisis. It helps you identify what you have and what you need so that you can make sure that you have enough stock in case of a crisis.
It’s also important to track your suppliers, especially if they are overseas or if they are in a different state or country. You will want to know where your supplies come from so that if there is an issue with them coming in on time, you will have an idea of how long it might take for them to arrive and how much longer it may take than usual.
Ways to utilize dock management system.
You can also keep track of your stock using a blockchain platform that will allow you to track your items from beginning to end. When you use blockchain technology, you can see where all of your products are located at any given moment in time. This will allow you to make sure that no one has tampered with them or that they have been stolen during transit. It also allows you to make sure that they are being stored properly at all times.
Use Data Analytics to Predict Inventory Needs
As of 2020, 60% of companies worldwide used data analytics to ensure cost-efficiency. Large-scale data analytics was adopted by almost 53% of businesses worldwide in one form or another by 2017. Data analytics can do many things for businesses. It can also predict inventory needs and help combat the supply chain crisis.
Use data analytics to predict your inventory needs. You can take a look at past sales and see what types of products sell better than others, and then use that information as a guide for what kinds of products you should stock up on next time around.
Leverage Logistics Intelligence
By using logistics intelligence, you can reduce your reliance on traditional transportation systems and get more accurate information about your supply chain in real-time. This will help you make better decisions, which will ultimately help you keep your business running smoothly.
Instead of manually looking after your stock and inventory, you can automate the forecasting process with logistics intelligence. You can also ensure warehouse automation and route planning with such a system in place.
Look for Alternatives
In the face of the current supply chain crisis, businesses need to be aggressive in finding alternative ways to get their products and services out into the world.
The first thing you need to do is look at your own business and its needs. What are you currently shipping? Where does it come from? Who is your supplier? Are there any other possible sources of supply that could help you meet your demand?
Once you’ve figured out what’s available, you can start doing research on each potential source to see if they’re viable options. Look at their product quality and service record, as well as their cost structure and delivery times. Then consider how much risk they add to your business model when compared with other alternatives.
If all goes well, you should be able to find a solution that helps keep your business running smoothly while also keeping costs down and quality high.
The global supply chain crisis has been an ongoing problem for a long time. Many people have been affected by it and will continue to be affected for a while. However, as we mentioned before–businesses must move forward, no matter what the circumstances are. So, it’s necessary to understand what’s causing this crisis, its current state, and how businesses can overcome it.
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