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A resilient supply chain is the core of any manufacturing business. However, as procurement and logistics become increasingly complicated, companies are struggling to develop resilience at the same pace.
There is a substantial quantity of information available about how to successfully secure your supply chain, and many sources point to one simple strength: supply chain diversity.
The concept of diversity can encompass so many facets of your supply chain, for example the range of suppliers that you source from, the number of locations where you have stock stored, and even the various methods of logistics you use.
But true diversity in your supply chain is not easy to achieve and can take a great toll on your time and finances. Additionally, if done incorrectly or without the right level of attention, the same diversity that was meant to safeguard your supply chain may cripple it.
Monitoring communications with multiple suppliers requires a level of time and organisation that many smaller businesses do not have available, overseeing inventory levels in multiple locations, organising and receiving irregular deliveries, and relying on a mix of logistical services can take a significant toll on cost and workforce allocation.
According to the Chartered Institute of Procurement & Supply (CIPS), concerns over supply chain disruption have reached an all-time high, with more than half of procurement leaders expressing concerns over short and long term stability.
A senior CIPS representative said that due to the volume of geopolitical tension, tariff uncertainty and price instability, procurement leaders are now “operating in uncharted waters”, with anxiety levels higher than ever recorded before.
The forecast cost increases and logistics difficulties are further reflected in Procurement Magazine’s 2025 Procurement Survey, with over 65% of professionals prioritising cost reduction and efficiency in the next 12-16 months. The category of ‘risk management and logistics’ was listed as a top priority for almost half of the professionals surveyed too, showing the growing importance of fortifying supply chains.
This focus on strengthening supply chains is taking away from more value-adding pursuits, like talent development and upskilling, which only 28% of professionals mentioned as a priority.
There are some common risk factors associated with supply chain stability. Currently the most prolific include:
A JIT model can be very beneficial to a company when implemented correctly. This inventory management system involves keeping the minimum amount of parts and stock necessary to keep production running, while scheduling deliveries to align closely with when stocks are due to run out.
On the surface this delivery system can maximise a company’s available space with the expectation that deliveries will arrive exactly when required. It can improve company cash flow and can prevent companies from ending up with excess inventory and overpaying for goods transport.
JIT comes from the lean manufacturing principles, which focus on streamlining processes, reducing cost and improving efficiency by removing non-value-adding activities.
There are a lot of other benefits when it comes to JIT, including more flexibility in the face of market changes and the reduction of supply chain waste.
JIT is often used alongside an inventory organisation system called Kanban, which means ‘visual card’ in Japanese. This method originated from the use of coloured cards placed at certain levels in the stock of parts, so when the stock level gets low enough to reveal the card, the person using the parts is prompted to order more.
While JIT and Kanban can significantly improve the efficiency of a supply chain, if not implemented well it can lead to operational disruptions and delays.
JIT requires a close-knit relationship between suppliers and manufacturers and constant communication. This is resource-intensive to manage effectively, especially the people element due to absence and contingency planning.
Another risk with JIT is supply chain volatility. A stable supply chain is critical to JIT or it will very quickly lead to line stops.
The reliance on accurate forecasting can also work against JIT users. If there are any miscalculations in requirements, for example if a company historically sells more in summer but does not increase order quantities accordingly, this could lead to production stops and operational difficulties.
In contrast to JIT, a Just in case (JIC) inventory management method involves maintaining high levels of stock to ensure there are no shortages and production can continue unabated.
This management style can safeguard against a lot of the risks that come with using JIT. With large quantities of stock on-site, manufacturers can be insulated to some extent against any sudden shortages or disruptive external events.
JIC works especially well for companies with very unpredictable sales volumes. In industries including military or medical, production may need to be ramped up without notice if an emergency occurs, so a JIC model would be beneficial.
While this may seem like a logical storage method, it has many cost-related downsides.
JIC-based companies will incur much higher inventory carrying costs and will be paying more upfront to keep stock levels consistently high. They will also be somewhat insulated or disadvantaged from spot price fluctuations in the market.
There is also the risk that demand dips, and the company’s facilities will have a backlog of unused stock, preventing them from producing or sourcing any additional stock.
The key to effective inventory management lies in finding the balance between these two very different management systems.
While JIT aims for maximum efficiency, JIC is more focused on security. Practically it is difficult to strike a perfect balance between the two, without help.
It is relatively common for companies to have a long list of suppliers. Usually there is no one supplier able to supply all the parts and components that the manufacturer requires, so they usually have no option but to work with a selection to meet their needs. This can be taken a step further if the same part is procured from multiple sources. While it may sound more complicated than necessary, it can also provide some security if a supplier has sourcing difficulties or stops trading.
During COVID, the need for multiple suppliers was made very apparent. With non-essential services shutting down and factories at risk of infection-related shutdowns, companies with a variety of suppliers were more likely to be able to source good facing shortages than those with a close-knit supplier network.
Global procurement has cost benefits too. When sourcing from multiple suppliers, it is an opportunity to find the most cost-effective parts. When these savings are considered, multiplied by how many parts are sourced, the savings could be very significant.
Global reach is not only a benefit for sourcing and procurement, it is also beneficial when it comes to the manufacturing process. Labour and production costs can have a significant impact on margins, and it can also be a benefit to have more than one production location, especially if it is in proximity to customers.
International locations can also be an advantage if there is any supply chain volatility. If one facility’s production is stopped due to a natural disaster or geopolitical conditions, then production in other locations can continue and mitigate any delays caused by the closure.
Many of these benefits can translate into supply chain disruption if not handled diligently. Many elements of careful planning are required to maintain a global supply chain, including managing multiple languages, the customs regulations of each country and every country on shipping routes.
When sourcing globally, companies are often working with a range of suppliers who do not share the same first language. The onus will be on the buyer to find a way to communicate with their chosen partners. To ensure they’re protected from any supply chain risks, you’ll need the ability to communicate to a high level to understand the information and costs the supplier informs you of.
It is often worth having a fluent translator who will understand the nuances of each language, to ensure there is no chance for potential miscommunications or misunderstandings. The cost associated with these requirements can be steep, and may not be included in an initial budget.
Regardless of language barriers, supply chains with a network of suppliers will face difficulty. Businesses will constantly need to be conscious of the quantities and delivery schedules for each item, and when there are multiple suppliers for a single item, the potential miscommunications and stocking issues are exacerbated.
There are many aspects that comprise a company’s logistics, and as such are many elements to consider to optimise this delivery system. Some elements to weigh are:
Currently, logistics is potentially one of the most difficult facets of a supply chain to optimise. As previously mentioned, CIPS officials have recognised that geopolitical and tariff volatility are causing significant levels of anxiety among procurement professionals. However, by taking steps to ensure your logistics are optimised, you can mitigate many potential risks.
Depending on location, destination and shipment sizes, companies can choose between land, sea and air shipping options. Each have specific benefits and risks associated with them.
Shipping by sea is seen as an economic and efficient way of transporting goods long distances and is often an indispensable part of a global supply chain. According to the International Chamber of Shipping (ICS), 11 billion tonnes of goods are transported by ship each year
The Suez Canal blockage of 2021 is a prime example of when things can go disastrously wrong. When the 200,000 tonne cargo ship the Ever Given became lodged in the Suez Canal, a total of 369 ships ended up stuck behind it, unable to deliver their cargo. The canal runs between the Mediterranean and the Red Sea, and is a direct link between Europe and Asia, making it a critical shipping route.
In the disaster, one major shipping company faced losses of around $89 million.
Land shipping is comprised of road and rail. It is one of the most used modes of transport; especially for domestic shipping. Transportation by truck is flexible, with reasonable transit times and the ability to deliver anywhere that is accessible by road.
Rail transportation can be efficient for shipping heavy loads long distances, and can be combined with road freight.
Land freight will usually be the cheaper option, depending on the final destination, but of course has limitations when it comes to shipping internationally.
Shipping by air is highly valued for its speed, compared to both land and sea. This allows companies to order JIT stock, or make changes at short notice, and the goods may still arrive within two days.
This freight method is also the most costly, with some estimates putting it as 20 times more expensive than land or sea shipping. There are also much tighter weight and size restrictions, so the transportation of heavy items may not be possible. Air freight must be coordinated with road transportation in the end.
There will often be multiple delivery routes available. Careful consideration is often required to select the safest, most affordable and reliable option at a given point.
While global reach can be of benefit to a supply chain, it also means international shipping, and the risks associated with this.
Once a potential delivery route has been chosen, each country the goods pass through must be considered, and the customs restrictions they have in place. Awareness of the the variations per transport method is also critical. For example, if goods arrive at a sea port, will the requirements differ to those based on a land border?
There are many benefits and opportunities afforded to those who are trading globally, including the use of bonded warehouses and freeports.
Bonded warehouses, also known as customs warehouses, are facilities where goods can be stored temporarily without the need to pay customs fees. If, for example, the final shipping destination was Europe, but there was a requirement to store the goods in a facility in the UK, fees would only be applied for entering the European country, not the UK.
This opportunity gives companies the ability to ship to and through multiple locations without incurring costs from the entire shipping route. Goods can be stored, manipulated or undergo manufacturing in these facilities, so for manufacturers who source parts from multiple origins, then manufacture in one country, and sell in another country, these bonded warehouses are essential to keeping costs manageable.
Freeports are another economic benefit afforded to manufacturers. OEMs can use these areas, usually located around shipping ports, to store and manufacture goods while deferring customs costs. The areas are designed to both boost the region’s employment and investment, and encourage trade and shipping through the location.
Both of these methods make international shipping much more manageable, but OEMs need to be savvy and aware to ensure things progress as planned.
Customs regulations can vary dramatically, and take many different aspects into account. These include, but are not limited to, country of origin, any potential trade agreements between the country of export and import, and the value of the items exported.
The correct calculations of these customs values could be critical to any business, as if it is incorrectly estimated additional costs will be incurred.
It is worth choosing a partner that can support you in logistics when shipping worldwide. When you work with Global Supply Services, you get in-depth shipping and customs support, which takes into account shipping delays, cross-country trade policies and supply chain risks.
Maintaining seamless communication with suppliers is a critical element of an efficient and resilient supply chain. In the current manufacturing climate, global sourcing, complex supplier networks and JIT models are common. These conditions make exchanging accurate, timely information vital to keeping a strong supply chain.
While manufacturers will all wish for simple, consistent communication with suppliers, it can be much more fragmented in practice. A single category buyer may be responsible for managing dozens of suppliers, each operating under different terms, delivery expectations, and approval requirements. Even a straightforward component order can involve multiple stages of communication, including quotation, purchase order (PO) submission, delivery tracking, and invoice reconciliation. This entire process can often require between 4 and 8 communications per order.
As the volume of components and suppliers increases, so does the complexity. This introduces:
When multiplied across hundreds of parts and various manufacturing sites, fragmented communication becomes a serious operational risk.
The consequences of poor supplier communication can include missed deliveries, incorrect parts, or delayed responses, which can result in production downtime, excess costs, and lost customer confidence.
Strong communication supports resilience by enabling:
When communication is structured, proactive, and reliable, suppliers can operate with more precision, which will help to protect their supply chain, even in volatile market conditions.
While supplier responsiveness is essential, manufacturers also have a responsibility to maintain accurate internal data. Without reliable visibility into stock positions or usage requirements, even the most reliable suppliers will not be able to provide a first-class service.
Manufacturers should:
Failure to do so often results in late orders, missed production targets, and unnecessary strain on supplier relationships.
Accurate internal visibility not only supports better decision-making, it helps manufacturers improve their forecasting, reduce over-ordering, and supports strong long-term relationships between manufacturers and their suppliers.
The management of multiple suppliers across different locations and different systems for each can pose a major structural challenge.
By consolidating procurement through a trusted sourcing partner, manufacturers could benefit from:
This approach often reduces the administrative burden on internal teams, increases transparency, and enhances supply chain scalability. It also allows manufacturers to focus on core value creating activities rather than supplier management.
In an increasingly unpredictable global setting, supply chain resilience is not only an advantage, but is critical for businesses to survive. Resilience comes in many forms for supply chains: in diversification, robust inventory strategies and optimised logistics to name a few.
Identifying where your supply chain is vulnerable is only half the battle, what follows is essential resource allocation, utilising expertise and creating a robust infrastructure to support this. It is difficult to have all the expertise you would want in-house. Many manufacturers overlook the efficient use of external expertise as part of their supply chain strategy.
Navigating all of these complex requirements can exhaust a company’s time and resources, leaving little room for internal procurement teams to focus on anything but maintaining the day-to-day supply chain requirements.
Global Supply Services (part of Cyclops Group) is a specialist end-to-end supply chain service provider.
From BOM analysis, vendor management and procurement through to shipping and logistics, GSS is a reliable, consistent service provider. We offer a complete, end-to-end supply chain solution designed to minimise complexity, proactively increase efficiency, reduce costs, and support uninterrupted production.
We simplify your operations, giving you more time to focus on adding value to your supply chain. You can expect:
GSS is trusted by manufacturers across multiple industries to support not only supply chain efficiency, but long-term growth. With offices and warehouse facilities across the world, we deliver both global reach and local reliability.
Whether you require continuity of supply, reduced procurement complexity, or enhanced inventory control, GSS delivers a tailored solution built around your production goals.
