Corporate DispatchPro TOM STACEY AND YING XIE, THE CONVERSATION VIA REUTERS CONNECT
Supply chains can easily break – here’s how they can be made more resilient to prevent shortages Supply chains are essential to everyday life, bringing materials to factories, food to your plate, and fuel to your car. The links in those chains – the manufacturers, logistics companies, warehouses and retailers – combine to form dynamic systems driven by customer demand. But a small, unpredictable change in demand can have major ramifications, as seen with the recent queues and rising tempers at petrol stations in the UK. This is because modern supply chains are not designed to cope with large levels of uncertainly around time, supply or demand. Instead, businesses have focused on developing operations which reduce costs But a cheaper supply chain often means a weaker supply chain. And problems arise when lean systems lack resilience and flexibility. This was perfectly illustrated by the disruption to the fuel supply chain in the UK which started in the distribution of supplies to petrol stations. Then the temporary closure of some forecourts triggered widespread stockpiling and panic buying. This, in turn, created a surge in demand for fuel, exacerbating the original disruption. There have been warnings that a similar situation could arise with supplies in the coming months – for everything from food and toys to Christmas trees. And it will take more than a few thousand extra lorry drivers to truly strengthen these supply chains. That said, more lorry drivers would be a good place to start. The UK currently needs at least 90,000 people driving HGVs, a shortage
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