Supply Chain Resilience Requires Recognized Vulnerability & Loss
Future-Proof Your Global Supply Chain
Did you know that supply chain disruptions equate to 45% of yearly earnings, in loss? (McKinsey study, 2020) Supply chains are growing more and more complex as companies continue to expand their presence around the world in pursuit of margin improvement. With a global supply chain value estimated at over $10 trillion dollars a year, the losses caused by disruption are quite alarming.
The Cost of Supply Chain Disruptions
McKinsey’s study on industrial supply chains showed that a long-term disruption could cost up to 50% of a year’s EBITDA, cutting into a significant portion of profitability. A short-term disruption of 30 days or less equals losses of 3-5% of EBITDA. On average, we can expect a long-term global supply chain disruption every 3 to 4 years.
How to Plan for Unexpected Events
Pandemics are just one of many shocks that have created extreme health ripples within the global value chain. From terrorism, extreme weather, and politics to financial crisis – vulnerability is everywhere and anywhere. Being impacted and seeing these shock losses is forcing companies to seek more proactive, vs reactive, resilience strategies around their supply chain management.
Preparing for future hypotheticals will require investment, but those costs are nominal in the grand scheme of business longevity. Technology is one of those investments that equates to efficiency. Global manufacturers are adopting a range of analytical, and AI-based technologies to enable more transparency, agility, and control within their supply chain. These investments are proving to not only reduce costs and risk, but also improve productivity and profitability.
We are bringing experts in global supply chain distribution and solutions to speak on current issues and how to plan for potential disruptions and how total supply chain visibility could give you tell-tale warning signs to pivot strategy. To learn more about this event and interact with these speakers, click the link below.
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