PwC - COVID-19: Operations and supply chain disruption

06 May 2020 |

The spread of the new coronavirus, COVID-19, is being felt globally across operations in ways that are difficult to model and assess. The affected regions are at the heart of many global supply chains. Hard information is lacking; concerns are mounting over depleting (or idling) stock; and companies fear they won’t meet contractual obligations on time.Understanding how global manufacturers are managing through disruptions to their supply chains will help all businesses structure their own responses. Impacts in many companies across many industries seem inevitable. In the near term, the cost of supplies from China may increase, stemming from overtime and expedited freight costs, as well as from paying premiums to buy up supply and hold capacity. Companies are also working through alternative sourcing strategies. It will be critical to identify alternative supply scenarios and evaluate what these mean for operations — for example, as cases of viral transmission emerge in different territories.

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