The ongoing supply chain crisis 2021 has extended into the holiday season. In truth, the supply chain crisis is made of several crises that arose from seemingly unrelated events. Let’s review a few of them:
- In January of 2020, China locked down much of its workforce. This severely impacted manufacturing, especially in electronics, consumer goods, and pharmaceuticals. An incomplete workforce recovery caused a lingering effect on global supply chains.
- Increased demand for medical gear, electronics, appliances and building materials. Then consumers started making delayed purchases for big-ticket items, such as automobiles.
- Crimped supply of semiconductors delayed product launches. Extreme weather events and lack of raw materials contributed to a plastics shortage.
- The pre-pandemic deficits in logistics came into view. These include backlogs shipping containers, rising shipping rates, port congestion, and too few dockworkers and truck drivers.
To sum it up, global supply chains have been optimized over many years to operate “just in time.” As a consequence, organizations and the shipping industry have struggled to absorb systemic shocks and deliver the goods.