Supply chain woes gradually start to improve ahead of Q4
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For the last two years, there has been an ongoing supply chain issue throughout the world for almost every business. If a business relied on supplies from different countries – particularly those far away – then it had to be ready for long delays. This had a profound impact on the rest of the business world, leading to price hikes that impacted companies from the top down.
The issue has been going on into 2022, with some reports earlier in the year indicating that it was even worse in some sectors. However, there is a light at the end of the tunnel! It’s believed that supply chain woes are gradually starting to improve as we approach the fourth quarter of the year. As this is always the busiest quarter, that news will be met with massive cheers around the world.
The pandemic bounce-back effect
What is the reason behind the improvements in supply chains across the globe? Primarily, you can look at one key factor that led to the issues in the first place.
It’s not rocket science, we’re all aware of the negative impact the pandemic had on the global economy. With countries forced into lockdowns and borders closed, shipping parts and products were significantly harder than ever before. Even after restrictions were lifted, there were issues relating to employees missing because of COVID-19. A lack of employees makes it more challenging for companies to work at optimal capacity, but then you have to also factor in the backlog of work because of lockdowns. So, struggling to maintain employee ranks compounded with the backlog meant it was almost impossible for supply chains to function properly.
However, the pandemic is now experiencing something of a bounce-back effect. A quick walk down any high street will show you that businesses are booming once again. This is translated through the supply chain as companies slowly get through the backlog and stabilize their employee base. Without lockdowns in most places, it is now easier to get your hands on any supplies you can think of. Companies can get forklift parts or computer accessories without waiting long periods or having to pay extortionate prices anymore.
There’s data to back this up as well. Flexport’s Ocean Timeliness Indicator shows a 35% reduction in shipping times over the last year. That’s very promising and hopefully a sign of things to come.
Supply chains are still not back to “normal”
These days, whenever we talk about things being back to “normal”, we’re talking about the pre-pandemic era. Despite the bounce-back effect, there is still some way to go before things return to how they used to be. Partially, this is because of the ongoing war in Ukraine, which has disrupted supply chains in the manufacturing and construction industries quite heavily.
So, it’s unknown when reality will return, but there are promising signs at the beginning of Q4. It seems as though most of the pandemic-related issues are slowly starting to go away, displaying vast improvements in the global supply chain.
