Talking Biz News Deputy Editor Erica Thompson reached out to Qwoted’s community of experts, including Vendavo CEO Bruno Slosse, to inquire about supply chain disruptions that have fueled inflation concern.
Before the pandemic, supply chains were being “sweated” the same way capital intensive businesses push their assets for peak utilization and minimal downtown: working to utilize any spare capacity. For supply chains, that often meant rationalizing suppliers and input alternatives. When everything is fine, running on the razor’s edge works, but it puts more eggs into fewer baskets.
When things aren’t going well – when volatility strikes, and there’s no “spare” left in your supply chain, and there are fewer (if any) options to bring in new suppliers and it becomes a recipe for extreme volatility. Many folks respond to volatility by locking in stability – often paying for that stability with an added premium and with this the inflation fire is fueled.