Supply Chain Pressures due to Covid-19

By Ariana Nieves,
Marketing Coordinator
Sustainable Investment Group (SIG)

photo of workers in a cargo yardIt is no doubt that the Covid-19 pandemic has wreaked havoc on the global supply chain. Approximately 94% of Fortune 1000 companies saw supply chain disruptions at the start of the spread in 2020. There were many miscommunications and a lack of understanding about the virus in the early stages of the epidemic. This caused many preemptive shutdowns and left the supply chain at a standstill.  

Many different factors created chaos within the chain. For example, labor shortages led to a disrupted gathering of raw materials from fields, rivers, and mines. Additionally, it worsened working conditions and lowered wages. Companies began to prioritize business-sustaining tactics over business-enhancing strategies. Resulting in the use of unethical cheap labor to ensure a small profit.  

Even two years later, the effects of Covid-19 are still being felt within the chain. Major delays in materials and products have caused things to slow down, hindering the global economy. However, through these stress tests, the pitfalls of the supply chain have become evident. Resilience is now key to sustaining success heading into the longer-lasting effects of the pandemic.  

The ESG standards are aiding companies in building this resilience. The emphasis is now shifting to sustainable approaches to supplier relationships. Approximately, 93% of executives plan to increase supply chain resilience. Prioritizing this may result in an increased focus on supply security instead of speed and low cost.  

Further, 51% of supply chain professionals expect that the focus on circular economy strategies will increase over the next two years. This will help aid in the net-zero and zero-waste goals of many corporations. In addition to this development, it will be imperative that corporations work to improve risk management plans to better prepare and reduce risks of falling into harmful tactics.  

The Covid-19 pandemic has created great challenges and struggles but it also may open new opportunities. Through the stress and pressure caused by the epidemic, the weaknesses of the supply chain have been exposed. This creates a chance to rebuild and create an even stronger more sustainable chain for the future. Many changes may be seen within the next two years, it will be interesting to see how it evolves.  


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