The “New” Normal- Global Supply Chain Post-Covid 19
While several questions immediately come to mind, a main concern both ourselves and our clients have: The pandemic disrupted the global supply chain as we all knew it, and now a huge worry and challenge is all the unknowns your business faces:
● Am I still able to purchase my inventory at the same pre-covid prices?
● Are my costs of doing business going to go up?
● Is my product or service still in demand post-covid?
As the economy begins to get back to the “new” normal, business owners, managers, and procurement departments may be rightfully anxious about getting back to pre-pandemic revenues, and as a result potentially digging themselves a deeper hole of debt.
Critical Considerations When Reopening Your Business
If you’ve been shut down or struggling throughout the pandemic, but are finally starting to see a light at the end of the tunnel, you’re likely faced with tough decisions around the most efficient and cost effective way to reopen – all while balancing the need for your inventory to keep up with the expectations of reopening.
As the economy reopens and consumer trends change, we believe it’s crucial for our partners, vendors and customers to get reacquainted with their customers, target audiences and update their market research.
Diligence and Discipline: Weigh All Associated Risks and Options
Costing has increased on a large global scale in the past 12-18 months, including shipping, raw materials, warehousing, distribution, etc. The entire supply chain has been affected drastically, and, in turn, will likely affect your costing and overhead.
As the economy tries to recover, it is making us think outside the box and look for any potential shortcomings (and opportunities):
■ If you’re bringing something in from overseas, be aware that the costs of shipping containers alone has increased 3-4 times since early 2020.
■ If business owners have to increase their minimum wage because they can’t find labour, how will this affect their overall operating costs and margins?
■ Have your customers’ tastes or purchasing behaviour changed during this pandemic?
■ Is the demand for your business, product or service the same level as pre-pandemic? (i.e. Gyms, Restaurants, Events, retail companies)
These are just a few of many factors we advise our clients to consider when discussing inventory, purchasing and operations. By addressing it early, you’re able to create a plan for the best chance at success. It’s crucial to forecast properly, be agile, and be willing to change as we return to the new normal.