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"Supply Chain Crisis Turns Into A Nightmare As
Shipping Crisis Push Prices To Stratospheric Levels"
by Epic Economist
"The supply chain crisis is creating the worst logistics nightmare the industry sector has ever seen. The people who actually run the supply chain industry are becoming increasingly desperate as disruptions continue to emerge in every link of the system. A myriad of problems is creating new chokepoints, and backlogs, and also sparking chaos at ports all around the world. And a new survey has exposed the many challenges plaguing supply chains and why they are likely to stay broken for the foreseeable future.
Several supply chain data sources reveal that many professionals are having problems tackling supply chain challenges this year. It’s never been harder to find solutions that actually help to fix this fragile system. According to Blue Yonder's 2022 Supply Chain & Logistics Executive Survey, almost all businesses, or about 88%, have faced disruption this year, with over a quarter, or 26%, facing prolonged interruptions in their operations due to supply chain issues.
On top of that, at least 43% of companies are experiencing staffing shortages, and 38% reported that their production is currently stalled. All in all, 58% of businesses said their customers will be facing delays this year as the port of Shanghai restarts and the shipping nightmare begins.
“It may not come as a surprise that most businesses are facing supply chain challenges over the past year, but the research demonstrates that supply chain disruptions are here to stay,” warned Shri Hariharan, Blue Yonder’s corporate vice president. In the US, an unexpected explosion of demand, a shortage of port workers, an absence of available chassis to move freight, and a weakened transportation infrastructure for domestic deliveries have combined to cause companies to fail to meet production, delivery, and distribution targets over the past 12 months.
Complex issues require multifaced solutions, and significant changes take time to occur. However, supply chain market research shows that the majority of companies, specifically 69%, do not have complete visibility of their supply chains, and around 30% of companies don’t analyze the source of supply chain disruptions whatsoever. This means that almost 70% of businesses are in an extremely vulnerable position and are still at risk of facing further disruptions.
All of these logistics headaches have largely fallen to supply-chain managers to sort out, making their jobs far tougher and mentally straining over the past two years. For that reason, supply chain managers are quitting their jobs at the fastest pace since 2016 due to a mix of burnout and late payments. The survey also found that loss of talent accounts for 51% of supply chain disruptions.
As problems pile up, those who run the system are getting absolutely overwhelmed and many are just throwing in the towel and giving up. The widespread nature of the disruptions is going to keep the system clogged for decades to come. In essence, supply chains are only as strong as their weakest link, and the myriad of issues emerging across every sector of the supply chains have demonstrated that weak links are multiplying much faster than resilience can be built. In other words, as disruptions mount and the system crumbles, the countdown to the next supply chain shock has already begun."
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