Increase in prices, shortage of products and shortage of workers
The supply chain is the processes or activities involved in the processing of raw materials into finished products and then delivering these finished products into the hands of the consumer. We may have taken the supply chain for granted because when we used to go to the grocery stores or ordered our products online, we were able to get them instantly. However, how many of you notice recently, that some of the shelves are empty, some of the items you ordered online are not available and the price of goods has increased significantly. One of the main reasons why these things are happening is due to the fact that the supply chain is in crisis.
One of the main contributing factors to this crisis is the result of COVID 19. Because of COVID 19, many workers have to remain home and therefore could not be involved in the processing of the raw materials and in the delivering of the finished products to the docks so that they can be delivered to consumers.
Also, the prices for containers have increased by more than 200% in some countries and as a result the transportation costs have increased which in turn increase the prices of goods. Furthermore, there is difficulty in accessing the raw materials and so there is a shortage. If you don’t have the raw materials, you cannot get the finished products.
By now, I hope you agree that we do have a crisis on our hands particularly for those countries such as the Turks and Caicos that virtually depend on other countries for products.
How should we deal with the supply chain crisis?
While we should not go in a panic state because of the supply chain crisis, we do need to recognize that there is a crisis on hand and we have to be prepared to deal with it. One of the major issues in the supply chain is that there is an increase in demand for goods particularly now that some of the countries are beginning to recover from the COVID 19 pandemic. However, the suppliers are unable to meet the demands. Perhaps what the suppliers need to do is to promote those goods that they have in stock and hopefully the demand for the other goods will go down as they become scarce since there will be less promotion.
The management of ports is also critical. If the port capacity is limited, it will impact how much supplies can be imported at one time and so we need to see how we can expand the imports to allow for greater capacity. If there is greater capacity, then not only more ships can come but also larger ships.
We need to continue to promote the production of local goods rather than depending totaling on other countries for everything.
We also need to increase the storage capacity for goods. Of course, this may not be applicable to all goods as some goods are slow moving and have expiration date.
The supply chain crisis requires collaboration among countries because the entire world is impacted. I don’t think anyone wants to go through another crisis like what we went through with COVID 19 and so it is crucial that countries come together and develop solutions to address this crisis. One thing countries can do to help aid this crisis, is to review and decrease the tariffs and rates associated with the importation of goods.
The supply chain crisis is a global issue and it indicates how dependent and reliable we are on others. This issue must be at the priority of any government. It must be alleviated otherwise we will continue to be faced with the increase in prices of goods such as fuel but also a shortage of goods. When the prices increase, it reduces the disposable income of every resident and if their disposable income reduces, they will not be in a position to acquire their needs. I encourage consumers to be conscious of their demands and whenever they get the goods they desired, do not waste them.