“Houston, we have a supply chain problem”.
During this third week of October 2021, the story about the supply Chain Crisis has flooded all forms of the media.
However, the manifestations of supply chain problems have been visible since Q1 of this year, 2021. General Motors has reduced operations of several plants and pending the receipt of semiconductor chips to complete specific electronic control systems in new vehicles.
The southern California Ports of Los Angeles and Long Beach have had between 50 to 100 cargo vessels waiting for docking and unloading facilities for the past few months. Material and product shortages have caused spikes in prices, up to 5X what they were a year ago.
Now that the supply chain backlog threatens the availability of products for the Holiday / Christmas season, we have a problem affecting everyone and sufficient to get the attention of the media.
Supply chains started to come under increasing stress during Q2 2020, or around the March-April 2020 time frame.
The first phase was noticed during the slowdown as Covid19 reduced economic activity and factories reduced production. Then in September 2020, orders rebounded and delivery times were extended.
During the Sept – November 2020 timeframe, many companies recognized the extended delivery times and focused on stockpiling components, especially commodity chips used in automobiles and a wide variety of electronic devices.
We believe the problems in the supply chain reflect an interwoven series of contingent dependencies. The resolution will take a coordinated effort among government, raw material producers, manufacturing, distribution, and consumer expectations. We may see economic disruption far greater than anticipated.
Join me with Mahaveer Jain, the Founder, and CEO of Source Select, a third-party Logistics company as he explains how the global supply chain was stressed by the Covid constraints, and what needs to be done to create a long term resolution. Our conversation touches on the following:
- The function of a supply chain logistics manager
- The Role of Covid-19 in reducing factory output
- The capacity limitations at U.S. Maritime Ports of Entry
- The depth of the Infrastructure Challenge
- The personal story about building a supply chain logistics company