Economic downturns are inevitable.
It’s not a matter of “if” but a matter of “when”. And most importantly, are you and your company prepared to weather the storm?
Most younger managers may not have experienced their first significant downturn. But more senior managers in their middle age will have lived through six stock market crashes and eight economic downturns.
Most companies tend to have plans, strategies, and protections for fires, floods, and earthquakes but are rarely prepared for an economic crisis. During the good times, businesses take on huge debt and make painstaking, in-depth, growth plans and expansion strategies.
However, in downturns, they find themselves with inflexible supply chains and little to no recession planning.
Most experts are warning of a global recession as they project economic conditions in 2023. Global growth in advanced economies is likely to plummet to a low 0.5%. And even emerging markets are projected to slow to less than 3%.
You must be wondering how to make my supply chain recession proof… come with me!
Fortunately, there are some key steps that can be taken to better prepare and address the risk associated with these tough times.
- Plan a recession strategy – “Hope is not a strategy”. Although most of us are hoping for a soft economic landing after the chaos caused by the Covid-19 pandemic, developing a recession plan is crucial.
- Focus on budgeting – Create or revise your company budget to reflect your recession plan. And be prepared to make dynamic changes as time unveils the reality of the economy.
- Reduce costs – Economic downturns create an unusually competitive atmosphere. Negotiate with your current suppliers, improve your commercial terms, and introduce new suppliers to the mix. Including suppliers from new countries of origin.
- Invest in technology – Automation and workflow tools can enable you to thrive – even in a recession. Increase productivity and consistency while reducing cycle times within your business.
- Audit your Supply Chain – Take the time to audit your supply chain. Look for the significant risks and uncover the opportunities. An audit can reveal these vulnerabilities and help you address them. Additionally, align your company and individual goals to take full advantage of the opportunities these times will afford and motivate your workforce to succeed.
Let Surefire Sourcing Solutions help to achieve your goals and protect your business while taking advantage of the many opportunities available to those who look to be creative.
