Estimated reading time: 3 minutes, 47 seconds

The past number of weeks have uncovered the weak links in our modern supply chains, further showcasing their delicate nature and highlighting the true importance of supply chain management. COVID-19 has disrupted supply chains worldwide, affecting key sectors such as technology, medicine, and food, to name a few. It has caused shortages in labour, shut factory operations, and slowed shipments. With a number of borders closed for the foreseeable future, export-driven nations look towards fighting a recession later this year. 

The modern supply chain is intricately interwoven and heavily reliant on China for manufacturing and assembly. According to Harvard Business Review, the largest 1000 companies in the world, or their suppliers, own more than 12,000 facilities in COVID quarantine-hit areas. As businesses in these areas slow, the world follows.

In the grocery sector, in particular, fear has driven consumers to panic-buying and hoarding. As the demand for eggs, toilet rolls, and personal protective equipment (PPEs) such as masks and gloves have increased, distributors and manufacturers of these supplies have struggled to keep up in time. This has caused a domino effect on the rest of the operational functions, proving that ‘just-in-time’ manufacturing doesn’t cut it anymore.

This crisis had exposed the venerability of the supply chain that has been a neglected area by most businesses in their urge to modernise their demand generation platforms in a very customer centric world we live in. This is a wakeup call most a lot of businesses and a lot needs to do done to truly future proof the B2B supply chain from such things in the future, some key areas highlighted as below:

  1. Businesses need to digitalise their supply chain to adapt to the changing behaviour of customers:

If anything, this crisis has accelerated multiple businesses around the globe and their digital transformation agendas. As nations are experiencing strict lockdown laws with social distancing rules being imposed, e-commerce has taken center stage, stepping up to help wholesale distributors sustain their businesses. In fact, data has shown an increase in online retail sales in March - a significant increase of 74% as compared to online sales in March 2018. If that rings true, a post-COVID landscape would likely see the supply chain industry fully shifting to digital within the next five (in the United States) to ten years (for countries like South East Asia and China).

  1. Collaboration is the key in maintaining customer experience:

Supply chain businesses today have aptly shifted their focus from competition among each other to collaboration in order to better serve and meet the needs of their customers. It is critical, now more than ever, that businesses come together to form an ecosystem - one that genuinely steers customer sentiments towards specialisation in distribution. This pause is the perfect time for businesses to draw out plans on how they can create more value for customers and suppliers in the future and future-proof themselves should we witness anything like this again. At the same time, this creates value for the distribution sector as a whole, especially in less mature markets.

  1. End to End supply chain visibility and risk management will enable faster reaction:

Beyond COVID-19, the global supply chain is also vulnerable to threats such as political and government instability, economic instability, natural disasters, and future epidemics and pandemics. Cyber threats are also ripe in modern supply chains along with threats in connectivity and data integrity and quality.

  1. Utilisation of digital supply chain specialists will expedite the change journey

To future-proof themselves, businesses must look towards building their own digital platforms. If this proves to be heavy in both price and maintenance, they can consider teaming up with a company who specialises in digital competency. Customers of today are choosing to transact digitally, and as customer channels are defined by the consumers themselves, distributors must look ahead and implement a strategy that increasing digital reach to their customers.

Hence in summary, when customers emerge from their homes post-pandemic, many would bear great revenue losses over the last four to five months. Many have also spent great amounts of money on maintaining their assets and keeping their business running. They will come out eager to make gains in efficiency, made possible by data, digitalisation, and automation - all of which can be supported by a distributor that’s put the time, money, and effort into expediting their digital transformation journey and subsequently, their digital offering. Time is key , don’t waste it.


Suroor Anwar, Vice President, Strategy and Commercial, APAC, RS Components, the world’s largest distributor of electronics and maintenance products

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