Agile Supply Chain Management Transforms Global Trade

Agile supply chain management has become a strategic and operational priority for many businesses with corporate leaders eager to tame the rampant supply chain disruptions of recent years. Many companies are rethinking their supply chains to increase resiliency and reduce exposure to geopolitical risks.

According to a recent Supply Chain Management Review article, an agile approach to supply chain and inventory management is imperative. Formulating a strategy that anticipates change and pivots with the circumstances increases certainty that inventories are available when needed. Cost remains a crucial matter in supplier selection, of course. However, location, reliability and predictability are now key considerations as well.1

In this transformative environment, now is the ideal time for you to choose SSI for your freight audit and freight payment needs, even if you are currently working with another provider.

SSI provides best-in-class global freight audits that are customizable and agile so they easily flex or scale to meet your evolving needs. Plus, the treasure-trove of transportation data we gather yields actionable data insights that enable you to make continuous supply chain improvements. Want to learn more? Let’s talk.

AGILE SUPPLY CHAIN MANAGEMENT IN THE TURBULENT TWENTIES

In the 2023 Global Risks Report, the World Economic Forum has labeled this decade, “the turbulent twenties”. The top disruptors in the next two years include the cost-of-living crisis, natural disasters, and trade/technology wars.2

Of note, each of these disruptors directly impact multinational businesses and the supply chain management teams they employ. EY, a global leader in consulting and strategy, concludes that addressing current and future needs requires companies to invest in their supply chains to improve agility, flexibility, efficiency, resilience, and environmental impact.3

Global trade data reflects that changes are afoot. Of note, China’s share of U.S. imports dropped from a peak of 22% in 2017 to 17% last year. Vietnam and Mexico are the two countries with the largest export gains to the United States in recent years. In fact, Mexico’s annual exports to the US have doubled to more than $400 billion since 2008.

Of note, several economies in Asia have boosted exports to both the US and China in recent years, including Malaysia, India, Thailand, Taiwan and the Philippines.4

ESG INITIATIVES ARE REROUTING SUPPLY CHAINS

Some business leaders are publicly stating the next phase of globalization is emerging as multinational companies reroute trade networks not only to boost resilience but to enhance environmental, social, and governance credentials.5

Today, more than 90% of S&P companies publish ESG reports, as expectations increase from employers, consumers, investors, and regulators. While some organizations are still determining what goals they will pursue long term, there is a hunger to have greater ESG visibility across regional and global supply chains.6

In some cases, choosing vendors closer to home may increase visibility into supply chain labor practices while reducing a company’s carbon footprint as transportation distances shrink.

In Germany, the Supply Chain Due Diligence Act (LkSG) recently went into effect. The law applies to companies with workforces of 3,000 or more that conduct business in Germany. The legislation aims to reduce discrimination, enhance environmental protections, and safeguard human rights. Many measures are required to comply with the law and supply chain visibility is paramount.7  Even if you currently do not do business in Germany, it is wise to assume similar requirements will emerge in countries relevant to your business.

FREIGHT AUDIT, FREIGHT PAYMENT & MORE

SSI is committed to helping new and existing customers save money and improve transportation, logistics, and supply chain efficiencies. Ask about these beneficial services.

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Footnotes:
1. Jennifer Blackhurst and Andrew Balthrop, “It’s time to move beyond just-in-time and just-in-case”, January 3, 2023, as published by Supply Chain Management Review.
2. Saadia Zahidi, “Global Risks 2023: The turbulent twenties, when risks collide”, January 14, 2023, as published by World Economic Forum.
3. EY, “Is your supply chain ready for the next five years?”, as published by CNBC.
4. Jon Hilsenrath and Anthony DeBarros, “Globalization Isn’t Dead. But It’s Changing”, January 16, 2023, as published by The Wall Street Journal.
5. Ryan Browne, “ SAP CEO says the world is entering the ‘next phase of globalization’”, January 17, 2023, as published by CNBC.
6. Kirsten Loegering, “How Companies Can Prepare Their Supply Chains to be More Green, Diverse and Compliant in 2023”, January 17, 2023, as published by Supply Chain Brain.
7. Chris Lewis, “Managing the Impact of The German Supply Chain Due Diligence Act (LkSG)”, January 23, 2023, as published by Supply & Demand Chain Executive.