Posted by Ben Wright | Aug 6, 2021 5:15:00 PM
For most product-based businesses, the supply chain problems that have defined the Covid-19 era are not going away quickly. Executives must still place bets on consumer demand and the availability of key components a year or more into the future instead of the six-month (at most) lead times common before the pandemic.
Many are facing a looming shortage of microchips, gumming up supply chains for goods ranging from automobiles to refrigerators. And costs for other basic materials—like lumber and steel—can be brutally high: Many companies are buying hard-to-find components on the spot market for 25% more than wholesale, while dealing with skyrocketing shipping container costs, which have more than quadrupled over the past year. And all of this is made worse by ongoing labor shortages in manufacturing and logistics across the globe.
Oxford Economics has conducted several large-scale, global studies analyzing executive perspectives and expectations regarding global supply chains. While challenges will no doubt persist in the short term, our research provides a picture of the evolving post-Covid supply chain. Thankfully, it’s not all about short-term survival. Here are three upside trends we expect to become permanent following the pandemic.