Another year in the supply chain industry means another year of unexpected changes, evolving technologies, and more. While we don’t have a picture-perfect plan mapped out of what 2023 will bring, we do have a few ideas of key factors that will impact the coming year. So, let’s say farewell to 2022 and get into Q1!
Redefining “Normal”
What is normal, anyway? And on that note, what is the “new” normal? Whatever they are, don’t hold onto them for too long. If the past three years have proven anything, things change. One of the aspects of our new, new normal is inflation. Still, while inflation may be looming over everyone’s heads, Forbes reminds us that although a recession is on the horizon, there are still ways to monitor what’s best for your company.
“In the US, consumer prices were up 9.1 percent over the year ended June 2022. This was the largest increase in 40 years according to the U.S. Bureau of Labor Statistics. In Europe, it is worse. Preliminary data from last Monday – October 31st – reported Eurozone inflation running at 10.7% for October. This is the highest ever monthly reading since the euro zone’s formation.
For supply chain executives, this is a good time to start contemplating stock keeping unit (SKU) reductions (reducing the number of products and product variations manufactured). Sales departments frequently fight these reductions, but the inflation environment gives supply chain executives extra ammunition to power forward with these initiatives.”
Keep a pulse on inventory, when to cut back or amp up production, and monitor demand. The supply chain market will change in tandem with our economy, so stay updated.
Cyber Risk
We’ve given you our spiel on the importance of data security and being aware of cargo theft, but it looks like 2023 could be a big year for cyber security threats. If organizations haven’t already, now’s the time to invest in data security and think hard about suppliers and partners. Oftentimes, hacking or cyber risk comes from vulnerabilities in external partners that give pathways to your company. Ensure your network is secure and aware—that’s the first step.
The Geopolitical Climate
Along with inflation, the war in Ukraine and other global disputes don’t look like they’ll be settled soon. Be prepared for global supply chains to constrict. As tensions rise, many businesses and manufacturers will keep their work close to home, which leads to higher costs. Be cognizant of what’s happening overseas, as it undoubtedly impacts what happens at home.
Team Support
As every industry has seen, there’s a shortage on labor. To combat that, this year will see a spike in employee retention efforts. Between hours, pay, and treatment, a lot goes into discussions about supporting a team (and hoping to recruit more members). So, what happens if this issue isn’t solved completely? Supply Chain Brain says we’ll pivot to see more automation.
2023 is already making history. Regardless of the twists and turns that will inevitably come, TOC Logistics is here to support your organization. Not sure where to start? Contact us and we’ll handle the rest.