It’s widely accepted that a chain is only as strong as its weakest link – and based on the past few weeks, it appears some global supply chain links are in need of improvement.
The escalating trade war between the U.S. and China is one of the most significant disruptions to the global supply chain. Both countries have been working to impose product tariffs, which has created confusion and hamstrung the flow of goods between them.
The confusion from the latest trade war developments and tariffs does not only impact the delivery of products, however. It can also affect how quickly payments are delivered across borders. Delays in payments, trade war-related or not, can be crippling for companies that are active in the global supply chain.
These changing market conditions are prompting companies in several different markets to adjust their supply chain strategies.
German automaker Volkswagen, for example, recently announced plans to restructure its group components business to better meet the demand for electric vehicles. Meanwhile, eCommerce giant Amazon is looking to partner with smaller businesses to help meet growing demand and improve the last mile of the supply chain.
Even companies that make back-to-school supplies for global markets are learning lessons about global supply chain operations. In the U.S., parents are currently rushing to stores to buy back-to-school merchandise for their kids, and companies that fail to deliver their inventory in time risk missing out on sales and seeing the value of their inventory decline.
That’s why some companies like backpack retailer Dabbawalla Bags are turning to global markets with school cycles that begin at different times throughout the calendar year. For the August Global Payments Architecture Report™ feature story, PYMNTS caught up with Susan Givens, the company’s founder, who shared the lessons she has learned in running a back-to-school supply company and the challenges of keeping a manufacturer financially afloat during slower-demand periods.
To read the feature story and for more insights on the global supply chain, download the latest Global Payments Architecture report.