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Supply Chain Graphic of the Week: How will Panemic Change Sourcing Strategies?

 

Some Companies will Leave China, Survey Finds, but Majority will No

 

July 22,  2020

 

There is a general sense that the virus-induced global pandemic will cause companies to pull at least some sourcing out of China and move back to US or close by countries such as Mexico, or wherever "local" is for a particular country.

 

A new report released this week by a group called the the Business Continuity Institute and another named Resilience360 (a unit of DHL) tried to quantify that trend, based on survey responses from 350+ supply chain professionals across the globe.

 

The full report is full of data, but here we looked at a couple of inter-related data points relative to post-pandemic sourcing plans, as shown in the graphics below:

 

 

Source: Covid-19 and The Future of Supply Chain

 

As can be seen, about 35% say they will either move a considerable number of supply sources or at least some from China or other far away sources to more local vendors.

 

About one-third plan no changes.

 

About 43% plan to source less from Asia generally or China specifically, while 57% plan on keeping Far East sources as is

 

Of course, many companies today saying they will make changes in sourcing strategies in fact will not, due to the many challenges of leaving China, including often higher costs.

 

So while we may see some movement, this data suggests it will not be a tsnumi of sourcing defectons from China.

 

Any Feedback on our Supply Chain Graphic of the Week? Let us know your thoughts at the Feedback section below.

 

Your Comments/Feedback

 
 
 
 
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