5 Ways to Create Resilient Supply Chains in 2023

For the past five years, supply chain disruption has been an abject concept. First, it was Brexit and the trade wars. Then, it was the pandemic. Now, it’s the Russia-Ukraine war. All the while, supply chains have suffered duress at every turn.

Now, as we stare down a likely recession, manufacturers have reached a breaking point. They’re sick of the disruptions, and they’re ready to do something about it to create supply chain resilience in the face of an uncertain future.

Supply chain struggles continue

While supply chains have been recovering for several months, they’re still largely disrupted — both in the U.S. and abroad. The chaos of the holiday season and the start of the new year are set to disrupt things even further, especially with regard to predicting customer demand due to widespread fears of an economic slowdown.

Amid these struggles, manufacturers need to prepare for a likely recession, and they can do that by shoring up their supply chain networks. Here’s a look at five ways producers can create more resilient supply chains in the coming year and beyond.

1. Bring the chain of custody closer to home

As shown by the COVID-19 pandemic and the Russia-Ukraine conflict, U.S. manufacturers can’t rely on foreign suppliers and distributors to avoid supply chain crunches. There’s simply too much potential for chaos and disruption. By prioritizing local service providers — even if the costs are higher — manufacturers at home can strengthen their supply chains and avoid potential disruptions.

2. Develop redundancies and contingencies

The strongest supply chains are agile ones. By crafting a supply chain with sufficient redundancies, manufacturers can position themselves to avoid major disruptions. This means having the capabilities to see freight in transit, as well as being able to stockpile, tap surge capacities, or use backup suppliers when disruptions become too overwhelming. Having a breadth of contingencies means bringing much-needed flexibility to supply chains.

3. Establish end-to-end visibility of supply chain data

A great way to create more resilient supply chains is to turn fragmented chains into one agile, linked network. Many producers are turning to digital solutions to link trading partners so they can anticipate disruptions and take action downstream. By connecting every link, and every workflow, with real-time data, producers can create collaborative networks for asset management, supply, and logistics.

4. Hire, train, upskill, and empower supply chain experts

Every producer can use a supply chain expert (or team of experts) on their side. One way to do this, without hiring new talent, is by cross-training current teams. Train key stakeholders in different departments and business units on essential procurement practices and supply chain contingencies. That way, they’ll be able to avoid a potential crisis by activating corrective measures in real time.

5. Explore new routes, partners, and timelines

Manufacturers can strengthen supply chains by researching new trade routes, modal choices, and partners. The most agile producers are diversifying their sourcing options. Whether that means seeking suppliers outside China or asking current partners to supply components outside Asia in countries like Mexico, many producers are finding that retaining several supply locations is costly, but necessary to keep supply chains stable.

Change isn’t easy — but it’s necessary

Manufacturers need to adapt to new ways of doing business. With a recession on the horizon, one way to bring stability to the factory floor is by building resilient supply chains. A strong supply chain is a key investment in the future to help producers weather any disruptions and challenges to come.