Supply Chain is in the Hot Seat!

Supply Chain is in the Hot Seat!

A year ago the entire world was impacted with an unprecedented national pandemic, the global spread of Coronavirus Infectious Disease, also known as COVID-19. This pandemic provoked our nation socially and economically in various ways. Implications of this crisis impacted supply chain management and its sustainability heavily. In the beginning we witnessed ‘supply shocks’ which are disruptions on the availability of goods such as home cleaning and essential supplies. This supply shock caused panic and chaos to consumers as the crisis deepened. Various states and communities began lockdowns, resulting in what we experienced as, ‘systemic demand shocks’.

Like many industries, spa manufacturers and their suppliers were leaving industry dealers overflowed with orders and having nothing to give, other than weeks to months long waiting periods and apologies. Another dreaded, yet predictable, effect of the spa manufacturer supply chain chaos has been the need for price increases due to increased costs.

Price increases are due to the current situation within the supply chain, despite the belief of manufacturers taking advantage of the surge in demand. Charges have skyrocketed in all areas causing manufacturers to charge extra in fees to make up for losses stemming from outsourced parts and shipping increases. Today, we are seeing supply-chain surcharges up to $400 per unit, as well as extra fees on color or model changes being made before units go into production.

This pandemic has been a turning point for supply chains worldwide, the urgency was amplified dramatically and there is undoubtedly more work to do to ensure resilient supply chains are moving forward. It is important to remember that supply chain is a profession that requires resilience.  The implications of this pandemic will be a defining moment in the future of supply chain, how we ultimately manage it and facilitate business. The lessons we learn and apply to our supply chains will make the biggest difference, customers will finally get their orders processed faster and money will be saved by focusing on sustainable and efficient supply chain operations. Hoping to remove supply chain from the hot seat.

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