COVID creates supply chain challenges for 93%, exposing weaknesses

Late deliveries the most common issue for supply chains, with widespread disruption creating an opportunity for re-evaluation

In a new report from Sikich and IndustryWeek, 93% of respondents said they had experienced supply chain challenges as a result of the Covid-19 pandemic. However, this allowed companies to identify areas of difficulties and will help with future risk-mitigation.

The top pandemic-related supply chain challenge, affecting 73% of survey respondents, was late deliveries from suppliers.

More than half of manufacturers also struggled with inventory shortages or outages (63%), missed or late deliveries to customers (61%), and increased inbound supplier lead times (58%).

This has led to new steps being taken from manufacturers, aiming to ensure resiliency for future. These include almost half (45%) diversifying their supply base, 17% investing in supply chain visibility technology, 16% switching logistics providers, or re-evaluating current suppliers, and 15% consolidating suppliers.

The survey also found that, while 10% or less of respondents' supply chains are currently offshore, companies are likely to decrease their percentage of offshore suppliers over the next five years.

Two-thirds of respondents (63%) said they plan to increase their investments in technology – including robotics and automation, CRM software, and demand-planning software, identifying technology as a key to overcoming future supply chain challenges.

"While the Covid-19 pandemic created many challenges for manufacturers, it also gave companies an opportunity to identify and address weaknesses in their supply chains," said Debbie Altham, senior director on Sikich's technology team. "As they try to put the pandemic behind them, manufacturers need to seek better visibility throughout their distribution networks and improve supply chain efficacy by strategically implementing advanced technologies."

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