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As an example, a major retailer whose market presence is in the Americas realized that several of their shipments that originate in China pass through Russia to make their way to the west and are now subject to shipment backlogs. Increased input costs: Russia is the second largest crude oil supplier in the world.
Over the past few years, supply chain and procurement pros have faced the challenge of navigating their enterprises through one disruption after another. Despite their best efforts, current events and market dynamics caught up with them, leading to issues managing their suppliers and sourcing the materials needed for their products.
Antimony (Sb): A metalloid used primarily in flame retardants and lead-acid batteries; predominantly sourced through stibnite (Sb2S3) ore. Even when sourcing from countries like Belgium, Germany, and Japan, there is often upstream exposure to China. Alternative sourcing: Identify additional suppliers to mitigate dependencies.
The company listed potential disruptions from geopolitical flashpoints, including the Russia-Ukraine conflict, tensions in the South China Sea, and instability in the Middle East, as the second most likely risk supply chains will face. The WEF survey ranked state-based armed conflict as the most pressing concern for 2025. Cyber Attacks.
Exiger has previously analyzed Chinas regulatory moves to restrict these minerals trade flows, highlighting the need to identify alternative sources of supply. Another concerning development is Russia joining China in considering similar export controls for other key raw materials. government procurement of critical components.
28% of global retailers have tried to find alternative sourcing options due to supply chain issues (RetailNext, 2020). Source: Consultancy.UK. Image source: Fortune. Natural gas prices in Europe and curbs on exports from Russia and China are expected to keep fertilizer in high demand through 2023, which will lower crop yields.
Earlier this year, QAD hosted a live webinar to explore and analyze the trends that are likely to dominate the procurement world over the coming months. It’s no secret that procurement teams have an amplified role within their businesses and that many are left with questions — our goal was to offer answers.
In 2023—if it wasn’t already—geopolitics became top of mind for every procurement professional. With the ongoing war between Russia and Ukraine, the Israel-Hamas War, and the crisis in the Red Sea, the shockwaves these conflicts sent throughout their nations and the world have been felt everywhere—especially in the supply chain.
It’s easy to oversimplify the differences between sourcing for parts locally or internationally. When considering where to purchase from, the prevailing idea seems to be that domestic sourcing allows for better control and shorter lead time, but international sourcing is more cost-effective. International Sourcing.
It covers everything from funding for defense programs to weapons procurement and national security initiatives. Transitioning to domestic sourcing is a strategic move to reduce vulnerabilities, but it requires significant investment in U.S. to expand sources of SRMs. Department of Defense each fiscal year.
Over 250,000 US companies, and over 160,000 European companies, have direct or indirect suppliers in Russia and Ukraine. Energy : Russia was the second-largest global exporter of oil and has been supplying over 30% of Europe’s gas. However, there is always more that can be done to address the ongoing humanitarian crisis.
Supply chain processes include procurement from source to pay, together with inbound logistics, production, quality control, outbound logistics and post-sales service. This recognizes the interconnected nature of procurement, production, logistics, and distribution. A supply chain is thus a complex sequence of operations.
The modern supply chain is global and often depends on Russia for production, either equipment or materials. Sanctions make these elements harder to procure elsewhere while preventing many companies from using existing Russian sources. In many instances, alternative sources are limited. What’s impacted? Raw materials.
The newest additions to the list will impact industries sourcing critical minerals, cotton, and polysilicon used in solar modules from the Xinjiang Uyghur Autonomous Region (XUAR) of China. Engage Alternative Sources : Identify and secure new suppliers outside of high-risk regions or entities. billion USD. What Comes Next?
By pinpointing suppliers in affected regions and analyzing their capabilities and products, clients can proactively identify alternative sources, ensuring continuity and minimizing operational disruptions. Source: Cal Fire) A Red Flag Warning zone, represented in pink, highlights areas where critical fire weather conditions are expected.
Risks include ongoing Red Sea disruptions brought on by attacks on cargo and container ships, the ongoing Russia-Ukraine conflict destabilizing manufacturing and trade activities, along with Taiwan trade risks brought about by Chinese military drills hindering trade through major sea routes.
The demand is subjected to change due to many factors drastically, including pandemics (COVID-19), war (Russia-Ukraine war), and last but not least technological advancements. Author : Emad Atef – CSCA, MBA (Candidate), Procurement and Sourcing Manager. Lysons, Procurement & Supply Chain Management, 9th Ed. ,
I’ve had the good fortune to be presented with opportunities for compelling discussions with a significant group of leading thinkers, senior executives in procurement, logistics, and technology management over this past year. Here is what I expect to see next year: Global supply chain footprints will continue to expand.
It's difficult to source and buy direct materials at scale. Due to resource constraints, procurement organizations are forced to concentrate on a few main categories: items that are either incredibly risk-prone or of significant strategic importance. The post The Role of Data in Sourcing Success appeared first on LevaData.
Even companies without a direct supplier connection in Russia or Ukraine will experience debilitating disruption across industries from energy to agriculture. On top of that, uncertainty over the conflict will lead to higher oil and natural gas prices worldwide, even if additional supply outside of Russia comes online.
trailed both Saudi Arabia and Russia in oil production, and it trailed Russia in natural gas production. Source: “The Future of Natural Gas: An Interdisciplinary MIT Study,” [link]. As the table below shows, back in 2008, the U.S. But by 2014, the U.S. Business Intelligence and Analytics. Network Connectivity.
They have been in an ongoing firefighting mode with new shortages occurring every few days; Covid, the Russia-Ukraine crisis, and the recent earthquake in Japan are just a few top-of-mind examples. Diversification of Sources. Now, they have OKRs in place to drive dual sourcing. Timely Visibility of Disruptions & Impacts.
Continued fallout, including transport congestion, limited air freight and rail freight transportation in the Asia-Europe lanes, because of the Russia/Ukraine conflict. QAD SRM delivers the tools to improve real-time communication and procurement processes and to counteract supply risks. Potential U.S.
Restoring More Direct Control in Materials Sourcing. Prediction Two of this year predictions indicated the following: Restoring More Direct Control in Strategic and Tactical Direct Material Sourcing Will be the Driving Force for Businesses and their Supply Chain Management Teams in the Coming Year. Mid-Year Assessment.
For example, one production company mapped their second tier of suppliers and realized that all of their strategic suppliers for a particular direct material sourced some components from a single production site, making them dependent on one source. It demonstrates due diligence and accountability in the supply chain.
Such actions were to include mitigation of risks related to China based sourcing, which is now commonly referred to as a China Plus sourcing strategy. That was followed by a public acknowledgement from CEO Tim Cook that the company’s 60 percent sourcing of various production within the country was too much.
Most car and truck manufacturers in partnership with their battery suppliers use a make-to-stock, supply-driven approach for producing and sourcing EV batteries, based on the availability of scarce materials like lithium, nickel, manganese and cobalt. Its easy to see how automotive manufacturers ended up in this predicament.
In order for logistics, procurement and distribution to align with the general advancements of the industry itself, these critical areas must give in to a more comprehensive transformation. The automotive industry has shown itself to be brave in recent times, in all areas but one: the supply chain.
In this Supply Chain Matters editorial commentary, we reflect on the ongoing Russia and Ukraine conflict, the implications for industry supply chains, and perhaps right now, a need for all to pause and reflect. Global citizens have been made keenly aware of the significance of the now ongoing Russia – Ukraine conflict.
Before Nornickel (Norilsk Nickel) became globally infamous for the Russia-Ukraine war profiteering of its largest shareholder, Vladimir Potanin , the company had a reputation as a leader in the emerging market for low-carbon nickel. But market demand for green and low-carbon metals is not going away.
The threat of sudden lockdowns continues to loom over procurement teams. Supply chains thrive on predictability, yet China’s continued zero-Covid policy is causing uncertainty and taking an economic toll at a time when we are learning to cope with other significant challenges, such as the fallout of the Russia – Ukraine conflict.
Maryna has: 5 years of experience in procurement training and consulting. 10 years of experience in purchasing and procurement, the tobacco market in particular. Maryna has: 5 years of experience in procurement training and consulting. 10 years of experience in purchasing and procurement, the tobacco market in particular.
Downside risks that include monetary policy miscalculations, an uncertain outcome to the ongoing Russia-Ukraine conflict and further supply network disruptions as a result of more far-reaching spread of Covid variant infection rates across China. The three largest global economies ( Europe , United States , China ) expected to stall.
But emerging technology is now beginning to create new ways to think about sourcing risk, which in the past has been a very manual, encumbered process. This has caused banks to look at the flow of activities in the “source chain”, which refers to the way that third parties use bank data for different opreations.
Across the geo-political landscape, the hostilities involving Russia and Ukraine continued through out the year, and in October, a sudden attack by the Hamas terrorist group on Israel has heighted Middle East tensions or threats of a wider conflict.
Previously, China established a governmental agency responsible for centrally procuring new commercial for the country’s major airline carriers, with the goal of securing the most competitive deals. This is further the challenge of securing long-term supply of titanium metal components which were primarily source in Russia.
In this Supply Chain Matters Product Demand and Supply Network Perspective we reference a published Bloomberg report addressing how the ongoing Russia-Ukraine conflict is impacting commodity and materials planning and supply concerns.
3rd S&OP in Russia and CIS. The Global Procurement & Supply Chain for Oil & Gas Industry. Logistics & SCM, PLM, Manufacturing, and Procurement 2016. Sourcing 2016 – Messe & Kongress für Indirekten Einkauf und Technischen Handel. eWorld Procurement & Supply. The Procurement Summit.
There are additionally the usual downside caveats that include further imposition of sanctions or consumer and business boycotts related to Russia. The OECD report reinforces that both Ukraine and Russia are large producers and exporters of key energy, minerals and basic food commodities.
Reportedly, since Russia’ s invasion of Ukraine , global CEO s are confronting a world of extraordinary volatility and uncertainty, forcing many to reassess their growth assumptions and put strategic plans on hold. The noted overall theme from this survey were indications that recession. cyberattacks. Inflation are top of mind concerns.
In his recent blog , Anmol Khurana discussed the immediate effects of the Russia-Ukraine conflict for companies shipping products in and out of the region. Even more damaging are the potential long-term impacts for the world’s food supply as Russia seizes Ukraine’s grain supplies and harvesting equipment.
It covers everything from funding for defense programs to weapons procurement and national security initiatives. Transitioning to domestic sourcing is a strategic move to reduce vulnerabilities, but it requires significant investment in U.S. to expand sources of SRMs. Department of Defense each fiscal year.
Such an interruption can affect any of the supply chain steps, often involving sourcing of raw materials, production, and distribution of goods or services. Both Ukraine and Russia are among the most important producers of the abovementioned commodities in the world. These are just a few supply chain disruption examples.
Source: JP Morgan and S&P Global, March 2022. As indicated in our February commentary , an area of major concern remains the effect and duration of much higher energy prices globally along with the ultimate implications of heightened economic sanctions on Russia. Global Wide Production Activity.
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