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The COVID-19 shook global supply chains upon its emergence and continues to do so as numerous industries grapple with material shortages. In this report, based on 100+ decision-makers in the retail industry, we examine how retail leaders are preparing to overcome the impact of the pandemic.
The COVID-19 shook global supply chains upon its emergence and continues to do so as numerous industries grapple with material shortages. In this report, based on 100+ decision-makers in the retail industry, we examine how retail leaders are preparing to overcome the impact of the pandemic.
1.
SPECIAL REPORT: SUPPLY
CHAIN RESILIENCE IN A
POST-PANDEMIC WORLD
Retail Segment
A Survey of OEM Supply Chain Decision-Makers
September 2020
2.
GOALS AND METHODOLOGY
RESEARCH GOAL
The primary research goal was to capture hard data on trends in supply
chain, particularly the impact of COVID-19 and risk management.
METHODOLOGY
Independent sources of OEM manufacturing professionals with responsibilities for their
company’s supply chain were invited to participate in an online survey. Responses were
captured between August 18, 2020 and August 27, 2020.
PARTICIPANTS
A total of 715 qualified individuals completed the survey including 101 that had responsibility
for retail devices and technology. All had decision making responsibility for supply chain
budgets at an OEM manufacturing company with more than $500M in annual revenue.
7.
COVID-19 HAS THE LARGEST IMPACT
Which of the following market dynamics are impacting your company's supply
chain? Choose all that apply.
1%
23%
28%
30%
32%
32%
33%
35%
37%
44%
70%
2%
24%
18%
18%
28%
28%
35%
20%
43%
43%
67%
0% 10% 20% 30% 40% 50% 60% 70% 80%
None of these
Supplier consolidation
Increased commodity pricing
Rapid technology transitions
Higher labor costs
Global logistics constraints
Labor shortages
Global trade and tariff issues
Increased demand
Supply constraints
Pandemic disruptions (COVID-19)
Retail
All
8.
SOURCING ISSUES HAVE DIRECT BUSINESS IMPACT
How have component shortages, limited materials, or other sourcing issues
impacted your business in the past year? Choose all that apply.
8
2%
8%
1%
26%
32%
36%
43%
62%
2%
11%
2%
30%
29%
38%
43%
64%
0% 10% 20% 30% 40% 50% 60% 70%
We have not had sourcing issues
We have had sourcing issues, but they haven't
impacted business outcomes
Other
We have struggled with quality issues as we
investigated options
We have been forced to raise prices
We have lost revenue
Our profit margins have narrowed
We have seen delays in our production delivery or
time-to-market
Retail
All
9.
VARIABILITY IN RISK MANAGEMENT MATURITY
How would you characterize your company’s predictive supply chain risk management
initiatives (i.e. technology and teams involved in the management of events such as
pandemic/global health issues, sourcing shortages, natural disasters, and geo-political
change)? Choose the one answer that most closely applies.
9
9%
13%
7%
7%
15%
16%
18%
17%
18%
19%
25%
22%
8%
6%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Retail
All
Fully executing our program with implemented
technology and team structures
Executing pilot projects
We have a detailed program in place that
includes technology and teams
Have a framework program in place
In process of developing our initial plan
Thinking about how to invest in technology and
teams
Haven't even thought about it
11.
FEW GIVE THEIR PREDICTIVE SUPPLY CHAIN HIGHEST
MARKS DURING COVID-19
11
How effective was your company's predictive supply chain risk management
approach in dealing with the impact of COVID-19?
12%
17%
39%
33%
39%
32%
9%
13%
1%
4% 1%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Retail
All
Excellent - we had visibility into coming
changes and easily adapted
Good - we would have liked a bit more
warning, but we were able to get info in time
to respond
Acceptable - we didn't get nearly enough
time to act, but we did get some warning
Not good - we didn't get information in time to
act
Terrible - we got bad information or no
information
Not applicable - we don't have a predictive
approach to supply chain risk management
Not applicable - we weren't impacted by
COVID-19
12.
RESPONSE TO COVID-19: TECH INVESTMENTS
Is your company investing in any of the following technologies or services to
address the impacts of COVID-19 on your supply chain? Choose all that apply.
12
1%
35%
43%
44%
46%
52%
54%
0%
35%
36%
33%
41%
50%
59%
0% 10% 20% 30% 40% 50% 60% 70%
None of these
Response protocol and process applications
Predictive analytics
Business continuity and readiness assessments
Advanced and demand planning
Risk management
Supply chain network optimization/visualization applications
Retail
All
13.
ALMOST ALL MADE SUPPLY CHAIN CHANGES DUE TO
COVID-19
What changes has your company made to your SUPPLY CHAIN as a result
of COVID-19? Choose all that apply.
13
2%
29%
30%
32%
38%
40%
47%
49%
1%
26%
31%
32%
31%
30%
47%
56%
0% 10% 20% 30% 40% 50% 60%
We didn't make any changes to our supply chain as a result of
COVID-19
Invested in regulatory/lobbying efforts to shape policy for
company's interests
Expanded EMS partnerships (e.g. outsourcing manufacturing,
production or supply chain management)
Modified end-buyer strategies (e.g. passing price increases to
customers, eliminating markets)
Explored manufacturing alternatives (e.g. reshoring, moving
manufacturing closer to customers)
Adjusted sourcing partnerships (e.g. investing in dual sourcing
strategies, revising approved vendor lists)
Deployed new technology (e.g. better supply chain visibility, risk
management, business continuity)
Optimized processes (e.g. streamline response times to process
recovery, increased incident management coordination)
Retail
All
14.
MOST MADE LOGISTICS CHANGES DUE TO COVID-19
What changes has your company made to your LOGISTICS as a result
of COVID-19? Choose all that apply.
14
3%
21%
30%
32%
34%
34%
37%
38%
44%
1%
17%
26%
33%
34%
31%
41%
37%
42%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
We did not change anything
Deployed dual-route transportation strategies
Adopted digital technologies (i.e. 3D printing)
Changed providers to be closer to customers to minimize
movement
Needed to re-route to avoid border closures
Deployed third party tools and services to provide real-time data
on capacity and mode availability
Investigated or implemented Transportation Management System
technologies
Identified additional options for 'last-mile' deliveries to customers
Had to quickly identify new options for international shipping
Retail
All
15.
COVID-19 HAS CHANGED HOW OEMS THINK ABOUT
MANUFACTURING PARTNERSHIPS
15
How has COVID-19 impacted your company's approach to working with
manufacturing partners? Choose the one answer that most closely applies.
30%
34%
37%
35%
23%
20%
2%
4%
8%
8%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Retail
All
More likely to work with large partners that can
absorb risk more effectively
More likely to bring manufacturing in-house for
greater control
More likely to work with smaller partners that
have more flexibility
Less likely to work with manufacturing partners
No change
16.
COVID-19 IMPACTED MORE SUPPLY CHAINS THAN
OTHER PAST DISRUPTIVE EVENTS
Which of the following have had an impact on your company's supply chain in
the past 10 years? Choose all that apply.
16
3%
35%
46%
50%
78%
6%
37%
50%
32%
80%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
None of these
Natural disaster (tsunami, hurricane, etc.)
Geopolitical and trade instability (tariffs, conflicts, wars,
large scale protests, etc.)
Materials shortages (electronic components, etc.)
COVID-19
Retail
All
17.
COVID-19 SUPPLY CHAIN ISSUES CAUSED THE
GREATEST IMPACT ON OUTCOMES
Which of these supply chain issues had the BIGGEST impact on business
outcomes? Choose the one answer that most closely applies.
17
8%
11%
15%
66%
8%
3%
2%
77%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
Natural disaster (tsunami, hurricane, etc.)
Materials shortages (electronic components, etc.)
Geopolitical and trade instability (tariffs, conflicts, wars,
large scale protests, etc.)
COVID-19
Retail
All
18.
ABOUT 9 IN 10 REPORTED DIRECT FINANCIAL IMPACTS
FROM COVID-19 SUPPLY CHAIN ISSUES
To the best of your knowledge, what has been the negative financial impact on
your company's business outcomes as a result of supply chain issues related to
COVID-19? Choose the one answer that most closely applies.
18
8%
8%
22%
20%
34%
30%
28%
32%
8%
10%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
All
Retail
More than $500M
$100M - $500M
$50M - $100M
Less than $50M
There has not been any negative financial
impact as a result of COVID-19 supply chain
issues
19.
STRONG AGREEMENT WITH A RANGE OF STATEMENTS
Effective investments in digital technologies and analytics will help
companies recover faster from the impacts of COVID-19.
19
49%
44%
42%
44%
7%
10%
2%
2%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
All
Retail
Strongly agree
Agree somewhat
Disagree somewhat
Strongly disagree
20.
STRONG AGREEMENT WITH A RANGE OF STATEMENTS
Our supply chain footprint has shifted notably because of COVID-19.
20
38%
37%
44%
51%
14%
7%
4%
5%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
All
Retail
Strongly agree
Agree somewhat
Disagree somewhat
Strongly disagree
21.
STRONG AGREEMENT WITH A RANGE OF STATEMENTS
We've always known the value of a diversified supply chain footprint and
sourcing strategies, but recent events (COVID-19, tariffs, etc.) have made it
even more clear.
21
42%
37%
45%
49%
11%
13%
2%
1%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
All
Retail
Strongly agree
Agree somewhat
Disagree somewhat
Strongly disagree
22.
STRONG AGREEMENT WITH A RANGE OF STATEMENTS
Outsourcing is the preferred model to reduce risk.
22
26%
30%
40%
38%
24%
25%
10%
7%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
All
Retail
Strongly agree
Agree somewhat
Disagree somewhat
Strongly disagree
24.
MOST CARE ABOUT SUPPLY CHAIN RESILIENCE –
ALTHOUGH NOT ALL FUND IT ADEQUATELY
Which of the following statements best represents your company culture?
24
66%
72%
28%
24%
6%
4%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
All
Retail
Supply chain resilience is a core value and is
funded appropriately
We talk about supply chain resilience but do
not adequately fund it
We aren't concerned about supply chain
resilience
25.
RESILIENCE PROGRAMS FOCUS ON A RANGE OF RISKS
What are the top risks that your organization's supply chain resilience program
focuses on managing? Choose up to 3 of the following.
25
2%
27%
40%
43%
47%
50%
53%
3%
18%
39%
42%
54%
50%
48%
0% 10% 20% 30% 40% 50% 60%
We don't focus on any specific risks
Geopolitical concerns
Travel restrictions
Workforce limitations
Price escalations
Logistics interruptions
Material availability or shortages
Retail
All
26.
RESILIENCE PROGRAMS HAVE A RANGE OF GOALS
What are the key goals of your company's approach to supply chain
resilience? Choose all that apply.
26
1%
30%
37%
39%
41%
44%
52%
53%
0%
20%
39%
39%
44%
47%
51%
52%
0% 10% 20% 30% 40% 50% 60%
We don't have goals for supply chain resilience
Reduce financial risks resulting from falling demand
All key suppliers are financially viable
Ensure consistent pricing
Increase visibility into supply chain to make decisions faster
High levels of agility to increase or decrease production
Always have multiple sourcing options
Ability to recover quickly without impacting customer delivery
timelines
Retail
All
27.
SUPPLY CHAIN STRATEGIES HAVE A RANGE OF FOCAL
POINTS
Which of the following are important to your supply chain strategies in the next
two years? Choose all that apply.
27
1%
38%
43%
53%
60%
61%
1%
39%
41%
51%
61%
60%
0% 10% 20% 30% 40% 50% 60% 70%
None of these
Moving manufacturing closer to end customer and markets
Effectively assess supplier community
Ability to predict shifts in supply chain
Reduce risk
Ability to respond rapidly to business/supply disruptions
Retail
All
28.
MOST TRACK METRICS FOR SUPPLY CHAIN RESILIENCY
What metrics does your organization use to measure supply chain resiliency?
Choose all that apply.
28
5%
41%
42%
69%
6%
38%
41%
63%
0% 10% 20% 30% 40% 50% 60% 70% 80%
We don't measure supply chain resiliency
Time-to-Survive
Time-to-Thrive
Time-to-Recover
Retail
All
29.
NO CONSENSUS ON GREATEST SUPPLY CHAIN RISK
In your opinion, what creates the greatest risk within your supply chain?
Choose the one answer that most closely applies.
29
28%
33%
26%
19%
19%
19%
27%
29%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
All
Retail Sourcing issues: materials shortages,
component issues, etc.
Trade issues: tariffs, regulations, geopolitical
instability, etc.
Demand issues: inventory optimization, storage
costs, time-to-market, etc.
Logistics issues: lack of predictability and
visibility into capacity availability and timeliness
of delivery
31.
FOR MORE INFORMATION
Dimensional Research® provides practical market
research for technology companies. We partner with
our clients to deliver actionable information that
reduces risks, increases customer satisfaction, and
grows the business. Our researchers are experts in the
applications, devices, and infrastructure used by
modern businesses and their customers.
For more information, visit:
www.dimensionalresearch.com
31
Jabil (NYSE: JBL) is a manufacturing solutions provider
with over 260,000 employees across 100 locations in
30 countries. The world's leading brands rely on Jabil's
unmatched breadth and depth of end-market
experience, technical and design capabilities,
manufacturing know-how, supply chain insights and
global product management expertise. Driven by a
common purpose, Jabil and its people are
committed to making a positive impact on their local
community and the environment.
For more information, visit:
www.jabil.com
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