How to Plan For and Work Around Supply Chain Issues So Your Business Can Thrive

As business owners and leaders, we learned important lessons as a result of the Covid pandemic and how it impacted our businesses. In survey after survey, business leaders universally recite supply chain issues as the number one problem that they face, followed by a lack of people to work as team members in their businesses. This is particularly true in the manufacturing arena.

Everyone has seen how many ships are moored along the west coast of the United States, unable to berth and unload their materials. Costco, Walmart, and Target rented their own ships to be able to get their inventory to the U.S. and unloaded before the holidays. There was already a shortage of workers and trucks to unload the goods at the ports along the State of California. As a further complication, the State of California would not allow trucks that were older than 3 years be used to unload trucks, as it might cause air quality issues. The State of California also required that all truckers had to be vaccinated against Covid. As a result of the shortage of workers and trucks, complicated by these two mandates, there are even fewer workers and trucks to unload and transport inventory to plants and warehouses across the country. This is something that was hard to predict, as it has never happened in the past.

Business owners have been huddling to determine how they can move forward with these severe problems in their supply chain. Here are some of the suggestions that companies have made and are now implementing:

1. Reshoring of production:

Many times, both the raw materials and the actual production of goods were done offshore. The finished products were shipped to the U.S. for distribution and sale. It may take a while to completely reinvent new supply chains, but inventive companies are designing around the shortage. For instance, companies in the U.S. are using less chips, going back to reliable old designs with either old chips or no chips. There are also plants that are being built in this country that will specialize in manufacturing the higher-end chips.

2. Dual sourcing/Regional hubs:

Just in time does not work as well if the supply chain is offshore and the demand is here. As a result, many companies are now dual sourcing raw materials to create more regional hubs that are located where the demand is located. This gives companies better control over their supply chains and allows the companies to manufacture regionally where the demand is located.

3. Planning for raw materials and inventories of critical products:

Businesses are finding that it is important to shorten the planning cycles for their supply chain and are incorporating that planning throughout their organizations. These companies are also working on crisis planning to develop alternatives in the event the current supply chain does not work, due to some other crisis.

4. Tag on to Other Companies With More Capacity:

There are companies in this country that have more capacity to manufacture for your company, or to use their trucks to deliver for you. This may be because of slowing sales in their industries, or they are trying to grow their bandwidth, but don’t have enough capacity right now. In the trucking area, the companies may deliver a full truck to a location, but are driven back empty—can you use that capacity for your needs?

This is the time for creativity and adaptability for business leaders. These are traits that U.S. business owners have been known for. If you are a small to midsized business, your ability to pivot may be quicker than the large companies. Necessity is the mother of invention. Use what is seen as a crisis to pivot, adjust, and grow into the future! Make this a great time to grow and strategically plan your business.

If you want to be alerted to new articles as they come out, please follow us on LinkedIn. You can also Sign-up for our Email List, and our Weekly Blogs.


Denice Gierach

Gierach Law Firm

Denice Gierach is an attorney, CPA, Northwestern University business master's graduate, and has owned several businesses from real estate to manufacturing. She is the lead attorney at Gierach Law Firm in the Chicago area. With more than 30 years of experience, she has been a respected and sought-after resource for businesses looking to grow, sell, solve problems, and succeed long term. Her insights across business areas gives a fuller lens to business issues and solutions, and helps businesses grow and succeed with less time spent on legal issues and other time-consuming problems.

JOIN OUR LIST

Blog Sign Up

 

Like what you see?

Follow us to stay current!

Facebook LinkedIn Twitter Youtube
search

630-756-1160

JOIN OUR LIST

Interest Area

Providing You With

Peace of Mind
Facebook LinkedIn Twitter Youtube BBB
From our offices in Naperville, Illinois, we handle matters throughout Illinois including DuPage, Cook, Will, and Kane counties and within towns such as Addison, Aurora, Barrington, Batavia, Burr Ridge, Carol Stream, Chicago, Darien, Downers Grove, Elgin, Elk Grove Village, Elmhurst, Geneva, Hinsdale, Hoffman Estates, Lisle, Lombard, Naperville, Oak Brook, Roselle, Schaumburg, St. Charles, Warrenville, Wheaton, and Winfield.
association and logos
© 2024 Gierach Law Firm | 
1776 Legacy Circle, Suite 104, Naperville, IL 60563 | 
630-756-1160
OVC INC
Back to Top