COVID-19. You can’t turn on the TV, read a newspaper, or get on social media without someone talking about the pandemic. Whether it’s bad news, very bad news, or stories about toilet paper hoarding, this newest strain of coronavirus is affecting our very way of life.
And, unfortunately, supply chains are not immune to the virus. Hundreds of articles have come out (and here’s one more) discussing the supply chain disruption, with companies announcing manufacturing and shipping delays or outright closing of plants. To add to that, businesses are seeing less global demand due to fear and distancing, which can bring about long-term damage.
The fear is real. It is strong. And there doesn’t seem to be an end in sight.
But, not all is lost. While people talk about how flimsy our current supply chain is to break down so easily, there are some things we can learn about the global pandemic.
Here are 3 lessons we can learn about how to manage supply chains in a post-coronavirus world:
- Know where you’re getting your product. Supply chains can be extraordinarily complex. With the global threat of coronavirus, companies have been surprised to learn that their supplier – whom they thought they had fully vetted – had to suspend production because the supplier has its own supplier of a specialty component from a plant in China that has shut down.
Supply chain managers who may have only focused one or two levels down in their supply chains will now have to track even deeper into their processes. Mapping the supply chain gives you full visibility into all the tiers of suppliers, including logistics, allowing to pinpoint (and, more importantly, respond to) the exact source of disruption.
- Diversify where you get your product. I have a friend in the dental industry who told me there are only about 4 manufacturers in China who make a chemical for one part of the gloves made to sell to dental offices. And now that the manufacturers are shut down, there is no chemical to make the gloves that are sorely needed. While it might take more time upfront to vet new sources, it will save you time in the long run if another disruption takes place.
- Anticipate customer demand. There are two sides of this coin. With the recent quarantines in place, consumer-facing companies should expect lower demand. People not going to stores or interacting with each other can lead to adverse psychological effects, which can take time to overcome.
On the flip side, with the disruption, product can be hard to get. Companies will have to plan how they will handle customer demand. Will they allocate based on customer importance or customer need? Will they offer similar, higher-inventory products instead? Whatever they decide, they need to be specific and consistent for long-term survival.
According to a recent Coronavirus Special Survey by The National Association of Manufacturers that took place between Feb. 28 and March 9, 2020, 35.5% of respondents say they are facing supply chain disruptions. Many of the respondents mentioned having to find alternate suppliers.
As for us, we are following the safety guidelines set for by the government. Our parent company, Earnest Machine, still has distributions centers up and running. We’ve seen minimal disruption, with our suppliers continuing to produce and ship at pre-outbreak lead times. And with many of our customers moving to a work-from-home policy, you can order parts on your own time, 24/7 online.
So, if you are one of the companies facing supply chain disruptions and know you need to find alternate suppliers, give us a try with your next commodity fastener order. We’ll get through this together.
In the meantime, stay safe and wash your hands!