Throughout 2022, we saw a range of supply chain issues arising, disrupting many markets and industries from within. Whether this was due to global disruption, labour shortages, or the rising costs, the supply and demand of 2022 has been one which many companies have had to battle to maintain their competitive edge.
No matter the industry, we all experienced some form of shortage or disruption in the past year. From uniform suppliers to small business retailers, it has been a challenging year, but we can use this as an opportunity to prepare for 2023.
Here, we will explore some of the issues the supply chain faced in 2022 and what we might be likely to see going into the new year.
Inflation
We have all been hit by the cost-of-living crisis – from those trying to keep their houses warm to businesses trying to stay afloat. As raw materials continue to rise in price, as do our products. This has led to problems in the supply chain, with the cost of creation sometimes outweighing the demand. And it is not only the price of raw materials which has grown to cause disruption within the supply chain, but a rapid increase in energy prices has made transportation scarce. For those that continue to deliver, it is becoming a bigger expenditure, and some smaller businesses might not be able to afford to continue this at all. The good news is that inflation is set to fall early in 2023.
Labour shortages and strikes
Inflation has not only caused problems with supply and demand, but it has unsettled workers across countries as wages don’t stretch as far anymore. This has led to many going on strike to dispute pay disparities and workers’ rights throughout the year. This year we have seen a number of strikes which have impacted people, from the rail strikes to the Royal Mail – all of which further disrupt deliveries too. In fact, the UK has lost more than half a million work days due to strikes across 2022. This causes disruption on all ends as customers and businesses alike worry about the delivery of their goods. We might see this go forward into 2023, with some unions planning to continue into the new year, such as the rail strikes going into January.
Logistics
A higher focus than ever has been placed on the logistics of deliveries and storage. Glasgow’s COP26 in November 2021 had a large emphasis on freight and logistics, with the environmental impact of transportation methods being brought back into question. This, alongside the global efforts to reduce carbon emissions, means that logistics companies are now going to have to transition their fuel consumptions to more environmentally-friendly alternatives. This can be expected to escalate as we head into 2023, with the International Energy Agency (IEA) asking for the banning of all new petrol and diesel cars by 2025. This will affect the ways in which we transport good both at home and abroad, as more countries shift towards renewable power.
Extreme weather conditions
This concern for climate change action comes from a rise in extreme weather conditions, something which we have all experienced in this past year. Whether it is the locations of our storage containers and warehouses, or it is the transportation of assets, the supply chain is especially susceptible to these changes in weather and temperature. The dangers of rising sea levels and extreme weather conditions for businesses include damages to assets, as well as customer complaints delayed services and temporary shutdowns. While effort is being made to reduce the impact of climate change globally, businesses should prepare for further weather conditions in 2023 and establish continuance plans in the event of blackouts or logistical problems.
Throughout 2022, we have experienced issues which have negatively impacted company assets and the deliveries of products to customers. This has ranged from logistical issues such as increasing stormy weather to unions strikes which have disrupted many working days. While inflation is set to decrease early in 2023, the impacts of climate change and the call for workers’ rights could see these issues continuing into the new year.
