The Supply Chain Solution – Today, we have an opportunity to reflect on what modern manufacturing is all about.
To start, winter is coming.
With it, demand for goods will climb even higher as Christmas shopping kicks into high gear. And an already stressed and sluggish global supply chain isn’t ready for the holiday rush. By now, we’re all familiar with the ills plaguing the supply chain since the start of the pandemic: factory shutdowns, geopolitical instability, and shipping bottlenecks have created shortages of critical components and materials across sectors.
China’s Power Problems are the Supply Chain’s Problems
As if those difficulties weren’t enough, recent and ongoing electricity shortages in China are only increasing the disparity between supply and demand. The power outages are due to an increased demand for China’s materials and manufactured goods as the world opens back up after pandemic-induced lockdowns.
Factories making those goods need a lot of power to run, but as demand has increased, the fuel costs for power plants have escalated as well — and due to governmental regulations, Chinese utilities can’t pass those costs onto their customers.