by Charlie Harte

Supply Chain Under Strain

Proficient Sourcing LLC provides OEM’s access to a network of outstanding manufacturing suppliers.  As almost all are midwestern, we offer an alternative to companies being subjected to supply chain difficulties with overseas suppliers.

The January/February edition of Expansion Solutions magazine has an excellent summary article “A Supply Chain Under Strain”.  The article points out several key supply chain points.

Everyone involved with foreign suppliers is aware of the potential for sea, air, rail, and road difficulties.  As the number of these systems and distances increase, the risks of supply chain problems increase dramatically.  Especially with the weather, politics, and various other complications.  The past year has demonstrated all this quite dramatically.

From the Expansion Solutions article:

“…over the past 12 months, unprecedented congestion at the nation’s major ports—particularly those on the US west coast—melded with jammed terminals, shortages of critical rail equipment, labor tension, a truck driver shortage, record fuel prices, inflation and markedly reduced consumer demand to create [problems for most sectors across the country].”

“A major factor that continues to exasperate is the mix of ongoing and complex political, social, and economic problems in China, the nation’s …source for 22% of total US imports.”  Frankly, we thought this was a higher number!  But a big problem, nonetheless.

“Almost 3 years on the situation [of reduced Chinese imports] is seen by many as the latest sign that 3 years of draconian pandemic restrictions and a steep decline in the global demand for its products have seriously damaged China’s once white-hot economy.”

“The latest round of strict isolation policies in China to combat covid is limiting factory production with analysts concerned that the country’s exporter flows will be hindered into 2023 unless the government there backs away from its increasingly unpopular social policies.”

This article suggests opportunity for those of us interested in reshoring manufacturing.  The article further notes “as a result, a growing number of US-based companies are reassessing their business in [China].”

Overall, the article notes import declines at major ports on both coasts.  For example, “the latest figures show that for the first time since July 2020 the ports of Savannah, Norfolk, and Charleston have all reported declines, while Houston reported an 11% drop year over year”.

This sounds like bad news for our economy since we rely on imported sources for vast quantities of manufactured components.

In addition to issues with seaborne supply, our economy dodged a major bullet when the major rail strike was averted.  The rail strike threatened would “have paralyzed the movement of countless containerized and bulk shipments and cost the nation’s economy upwards of $2 billion PER DAY!”

To illustrate the significance of our rail system, the article notes this attention-getting comment:  “American Trucking Associations president Chris Spear reacted [to the rail settlement], stating that a rail strike would have been disastrous and catastrophic.  The trucking industry alone, he added, has neither the equipment nor the manpower to replace a single day of lost freight service”.

Perhaps your supply chain has some, or maybe even all this complexity.  In case some reassessment of your manufacturing supply is in order, be advised we have a large network of domestic shops available to serve your needs.  Help is just a call away:  (513) 489-5252.

About the author 

Charlie Harte

I’ve built this business based upon my 30+ years in manufacturing sourcing and productivity improvements, where I’ve developed strong relationships with a network of local and global suppliers who’ve demonstrated on-time delivery, parts built to spec, excellent service and value. This means HAPPY CUSTOMERS!