This project is part funded by Invest Northern Ireland and the European Regional Development Fund under the Investment for Growth & Jobs Northern Ireland (2014-2020) Programme

Supply chain issues and how to navigate them

DATE: 16/05/22


Small business owner or budding entrepreneur, you’ll probably have heard more about ‘supply chain shortages’ over the last couple of years than ever before. But what does it really mean, to us as individuals and as businesses? Why is it suddenly such a pressing issue? And what can small businesses do to work around supply chain problems as and when they do arise?


Supply Chain 101

In short, every product we consume, reaches us through a chain of companies. From the initial manufacturer to the logistics firms (providing storage, transportation, distribution), to the end retailers. This process is a ‘supply chain’ and the many moving parts, often traversing the globe mean our supply chains are incredibly delicate and outside pressures can cause serious disruptions, which ultimately affect us all as consumers.


Global Pandemic

There can be many external problems that could impact a supply chain, from adverse weather to crop failure and everything in between. These last few years however have thrown up the perfect storm of problems meaning that many or most of our supply chains have been significantly affected. The impact of Covid cannot be understated, causing a global shortage of workers, reducing production capacity and bringing many industries to a complete stand still. Not to mention the series of lockdowns and restrictions which have varied from country to country adding layer on layer of hurdles to overcome.


Political Factors

As predicted Brexit has caused serious disruptions in the supply chain world with a hefty increase in administration and red tape for import and exports, as well as cross-border checks which all together add up to serious supply headaches. Russia’s invasion of the Ukraine has also severed key supply lines for nickel and aluminium, wheat and sunflower oil causing many prices to skyrocket.


Focus on the environment

We can’t forget the environmental focus of recent years. Consumers, industries and governments are far more in tune with finding more sustainable ways of production and distribution and ultimately measures taken are impacting heavily on transportation which is of fundamental importance to most supply chains.


Customer decision making

As a combination of all of these issues, we’ve also seen a distinct shift in customer behaviour. Managing cost of living increases, perceived shortages of products, increased prices and in some case a lack of availability in certain areas, consumers are choosing to spend their money differently. We’re seeing a return to shopping local, price sensitivity has changed and scarcity fears have customers stock piling which all result in increased pressures on supply chains many of which could not have been predicted.


Ultimately manufacturing and logistics businesses are expensive to run and are often run at near capacity to avoid waste and loss so when supply chains are put under pressure, there is very little scope for manoeuvre. So what can small businesses do to prepare for and move through supply chain issues without being too adversely affected?


Map your supply chain

Dig deep and detailed into your company supply chains. Go through each step, each piece of the process which brings what you need to you and your customers. Break it down and when you have a clear map of each and every stage, you can start to plan ahead.


What are your issues and what can you do?

Once you have your supply chain map, highlight the push points where you feel you might experience problems. There will be some that stand out as the most fragile, and some that you can predict will become problematic if the economic conditions dictate. List them out, and really consider what your options would be in the event of issue arising. What can you do to minimise your risks in each instance? What other options could you consider? Multi sourcing is key. Do some research into how you can have multiple options to secure the products you need. Ideally can you spread these options out both locally and internationally so that they rely on different infrastructures? Diversifying your supply routes can go a long way to future proofing any problems.


Integrate resilience

When you’re planning ahead and putting in place mitigations for the future, make sure you build in the resilience considerations you need as part of your strategy. In addition to multi sourcing, this includes having backup capacity that can be brought to market quickly, and considering holding inventory as safety stock.


Continued monitoring

Keep a close eye on your market, on your industry and importantly on the statistics and figures impacting what you do, where you get it from and what patterns you’re seeing. Your figures are of huge help in predicting trends and problems so leverage your data to improve your own market understanding and to truly understand your inventory and finances.


Put people first

Keep your workforce at the forefront of all your plans. If you can focus on keeping your team healthy and happy in work and in themselves, you’ll be building solid foundations for coping with any supply chain issues that come up. Building company culture around support and recognition, extending that out to your suppliers and supply chain members, these things may seem unnecessary but you’ll find that what you put into these relationships is what you’ll get out when you most need it.


Whatever stage of business development you’re at, you are likely to experience some supply chain complications whether now or further down the track. Start planning earlier than later, make sure you really understand your own businesses and it’s potential vulnerabilities so that you’re as prepared as you can be to weather any supply chain storm that comes your way.


Whatever your business idea, whether it’s just something you’ve been mulling over or whether you’ve taken some steps on the entrepreneurial path already, we’d love to help. Read some of our Go For It Success Stories and get in touch . Our business experts will be delighted to hear from you and to talk you through everything you might need to know to move forward with your business concept.