Supply chain disruption is more than just a buzzword—it’s a reality that impacts business operations and customers. From transportation delays to raw materials shortages, the consequences can be dire for businesses of all sizes. Delays can lead to production slowdowns, missed shipping deadlines, and dissatisfied customers. In some cases, companies can run out of inventory altogether, which requires them to hasten subsequent shipments and ties up money and warehouse space in the process.
Typically, supply chain disruptions are the result of a sudden change to customer demand or unanticipated events outside of your control. However, if you don’t have a flexible and adaptable supply chain management system, you’ll be at the mercy of any black swan disaster that hits.
Natural disasters, such as earthquakes or hurricanes, can damage infrastructure and cause logistical challenges. Additionally, the COVID-19 pandemic led to closed international borders, travel restrictions, factory closures, and labor shortages.
Other events, such as strikes or the escalation of trade tensions, can also interrupt manufacturing and shipping. Air and rail freight are often limited during these times, leading to delays in delivering products to customers.
Global politics can also cause supply chain disruptions, such as export bans or tariffs on critical goods like semiconductors and food products. These events can result in higher prices, lost revenue, and damaged relationships with suppliers. In short, these types of disruptions are a huge headache for business owners, and if they happen often enough, the impact on revenue can be significant.