How a Pandemic has Affected Global Supply Chains

The COVID-19 pandemic is having a significant impact on supply chains across the world.

The rapidly spreading virus has seen many industries grind to a halt. The aviation, manufacturing, retail sectors (excluding food retailers), and others have been forced to cut business activities, causing economies worldwide to slump.

This reduction in activity in almost all industries, coupled with a growing number of transportation and movement restrictions has resulted in global supply chains being detrimentally impacted.

In light of the global pandemic, supply chains have demonstrated themselves to be more fragile than businesses have prepared for. Many big manufacturers operate across locations, involving processes conducted across different countries, relying on international travel to ensure products can be completed. Other manufacturers are less impacted by import and export restrictions. They count on large numbers of people working closely together, which is also being disrupted due to the implementation of social distancing rules.

Healthcare supply chains, in particular, have been disrupted by the pandemic. There is rising concern that the supply of prescription drugs in the US may suffer due to their reliance on China’s raw materials. It is predicted that the shutdown in China may affect the pharmaceutical drugs available in the US in the coming months. However, the FDA currently reports that it has so far suffered no shortage of active pharmaceutical ingredients.

Renewable energy is another sector whose supply chains are under significant threat from the pandemic. Recent years have seen a surge in the global capacity and use of renewable energy sources in a bid to combat climate change. This year the sector was expected to continue to show rapid growth. However, the pandemic disrupts both the operations in manufacturing facilities and the availability of materials through supply chains. Some significant projects planned to take place this year to expand the global renewable energy capacity have already been delayed.

Making supply chains pandemic-proof

Fortunately, there are steps businesses can take to promote supply chain security in these uncertain times. For example, implementing digitization across the company can facilitate supply chain visibility. This visibility is essential to reacting to disruption effectively, helping businesses plan out how related processes further down the chain will be impacted, allowing them to implement contingency plans.

Ensuring data privacy for suppliers is another crucial strategy. For upstream suppliers to remain competitive, they do not provide information to end customers. Using blockchain facilitates the secure sharing of data, without the point-to-point integration that centralized systems require.

Finally, putting strategies into motion as soon as possible is vital to protecting supply chains as initiatives take time to establish fully.

Export Portal was established to facilitate international trade between SMEs. Using blockchain technology, Export Portal supports secure and cost-effective international trade that is uncomplicated, which is becoming increasingly crucial as pandemic-related disruption continues to impact supply chains.

Planning for and understanding supply chain disruption will be crucial to keeping businesses operating throughout this global health crisis. Export Portal’s blog aims to communicate the essential information to allow SME owners to do this.