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Half of firms haven’t acted on supply chain resilience

A survey of over 1,200 companies has revealed that only 48 per cent have taken measures to avoid disruptions to their manufacturing supply chain over the last ten years.

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A survey of over 1,200 companies has revealed that only 48 per cent have taken measures to avoid disruptions to their manufacturing supply chain over the last ten years.

The finding comes despite 72 per cent of companies saying they have experienced supply disruptions within this timeframe, and 96 per cent believing that measures should be taken to avoid future problems.

The research has been published in a report on supply chain resilience by Amsterdam-based manufacturing platform 3D Hubs against the backdrop of COVID-19, which has been the single largest disruptive event to supply chains in the last decade.

The risk of other disruptive events such as natural disasters exacerbated by climate change, or trade wars and geopolitical events like EU Exit, are also rising, the report explained:

“From trade wars to pandemics to changing labour environments, supply chain resilience is becoming a priority for many companies. The rise of global trade means companies have more moving pieces stretched over greater distances with less slack in the system. And with a growing global population and a growing economy, significant supply chain disruptions are inevitable.”

One of the recommendations from supply chain experts in the aftermath of COVID-19 is for manufacturers to diversify their supply base across a greater number of regions; something which 59 per cent of the companies surveyed by 3D Hubs agreed should be a priority.

The report adds:

“Companies are still relying on a single company for certain parts in order to achieve lower costs. Reducing essential processes and resources to a single or a few sources creates a dependency on deep-tier suppliers as well as on concentrations of supply sources that create fragile chokepoints in the global economy.

“Only a handful of countries are responsible for the world’s supply and, as many companies experienced with the coronavirus outbreak, this over-reliance can have catastrophic long-term effects on supply chain operations.”

Offshoring to Reshoring - time for a change?

To strengthen supply chain resilience, the report recommends three key approaches:

  1. Create autonomy through automation and additional inventory for critical parts
  2. Develop flexibility through geographical diversification and agile working processes
  3. Increase visibility through building stronger supplier relationships and increasing monitoring and mapping activities.

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