35 Signs That Show The Supply Chain Is Dying Right In Front Of Our Eyes

The global supply chain crisis is reaching catastrophic proportions. Since the burst of the sanitary outbreak, supply chains have never caught a break. Lockdowns, port closures, congestion, factory shutdowns, trucking delivery delays, shipping container shortages, and the lack of enough qualified workers have taken a toll on supply chain operations, global manufacturing, and business sales. On top of the problems we already had in 2021, the conflict between Russia and Ukraine has caused severe damages to critical sectors of this gigantic trade network. The system has become extremely fragile, and the combination of dozens of unsolved problems is threatening to push global and local supply chains to a breaking point in 2022. For that reason, we decided to compile very alarming statistics that reveal the factors aggravating shortages, shipping disruptions, and other critical issues causing chokepoints all across the system.
Since 2020, the imbalances between supply and demand have only grown wider, resulting in a major inventory distortion as retailers struggled to anticipate consumer needs – oftentimes, overordering items to prevent shortages. After experiencing extensive shortages and delays, companies in many sectors have boosted their buffer stocks, filling warehouses with products and components as insurance against future disruption. However, consumer trends have greatly shifted, which has left global retailers with an estimated overstock of $626 billion in products that are not selling at the forecasted pace, while the estimated value for out-of-stock items consumers are looking for right now is $1.14 trillion, data from the IHL Group shows. On average, U.S. retail operations have a supply chain accuracy of only 63%. This can result in significant delays and re-stocking issues. For instance, in 2021, 34% of businesses shipped an order late due to selling a product that wasn’t in stock.
While port congestion data for March captures the early effects of the Ukraine crisis, it does not reflect the lockdown in Shanghai. With traffic jams having increased significantly in Chinese ports due to the zero-tolerance policy in China, and in the North Sea due to the conflict in Ukraine, global schedule reliability is expected to drop by 10 percentage points by June, according to Sea Intelligence estimates.
These numbers portray a very gloomy outlook for global supply chains in 2022. We’ve been witnessing continued disruptions for 24 consecutive months, and as if that wasn’t already distressing enough, executives are bracing for much more turbulence this year, as conflicts worldwide escalate, global manufacturing slows down, and the imbalance between supply and demand gets bigger and bigger. The global supply chain breakdown is getting worse by the day, and this means that all of these problems will stay with us for years. Here are 35 Numbers That Expose The Global Supply Chain Breakdown Is Accelerating At A Breathtaking Speed.