Covid domino effect warning for UK supply chain
FORTO CEO and co-founder Michael Wax said: “The recent spike in Covid-19 cases in China – and the resulting congestion around its ports – will have a domino effect on supply chains around the world. But it will take time – 6 weeks or longer – for this shockwave to reach European markets.”
Photo by Chris Pagan on Unsplash
Shanghai has reported a new record of more than 26,000 COVID cases in 24 hours. Other cities around China, including the southern city of Guangzhou, are introducing new restrictions and building makeshift hospitals as the Chinese government continues with a strict policy to contain spread via lockdowns.
Forto is a digitised freight forwarding and supply chain solutions firm.
Wax added: “The biggest problem for most businesses right now is not with international carriers, but a lack of production. Lockdowns mean labour isn’t available to keep factories running, or to move goods to China’s ports. Many suppliers currently have well-stocked warehouses in the EU, which will help to cushion the effect on consumers for the time being. But if these lockdowns continue, we may start to see reduced product availability in the coming months.
“The impact of this also depends on the primary mode of transportation used by a business. The bottleneck is not the ships: ports and shipping are, currently, generally functioning, whereas the air freight sector is seeing a larger volume of cancellations.
“To mitigate the impact of this, we’re advising customers to allow for greater shipping times and to invest more time in planning, if they have suppliers that are operational. Now more than ever, it remains important to be flexible and make the most of real-time insights to inform supply chain strategies.”
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