Supply Chain predictions in 2022

 

It´s no secret that Supply Chain has become one of the most heard words in 2021. If nothing else, we have spent pretty much the entire year battling Supply Chain disruptions, and this is likely to continue in this new year.

From a sudden increase in cyberattacks during the first quarter of the year to port congestions and labour shortages, we have faced unprecedented challenges in the Supply Chain arena in 2021.

But it´s fair to say that with challenges there were also opportunities for organizations to learn, adapt to unexpected circumstances and develop new ways of working.

As we start a new year, here are four trends that we might see more of in 2022.

1 - Supply Chain issues are here to stay

The current landscape is not going to fix itself in the early days of 2022, and it´s very likely that it will take months for all of the issues that in 2021 caused a perfect storm to start fading away.

Global shortages of plastic and paper as well as labour will continue impacting Supply Chains, this will mean continued order delay and supply shortages.

2 - Automation to compensate the labour shortage

Linked to the first point, in 2022, labour shortages are expected to continue, in order to close the gap, business leaders will need to continue heavily investing in automation technology to perform certain tasks for which labour is in scarce.

Aditionally we will see further development in new technologies like AI to carry out more complex tasks.

3 - Increased logistics costs

2020 and 2021 saw the explosion of logistics costs after many years of efficiencies and cost reductions. As online shopping, inflation and energy cost continue to drive prices higher, we can expect cost to contiue increasing in the near future.

Transport and raw meterials, will drive the increase due to the existing shortages as well as a rise in demand that has been exceding existing supply for the best part of 2021.

4 - Big focus on sustainability

Consumer growing efforts to be more environmentally responsible has been and will continue pushing companies and specifically Supply Chains to cause less harm to the environment. 

Companies are expected to implement more eco-friendly Supply Chain processes and transportation will likely migrate to more environmentally friendly alternatives to reduce greenhouse gas emissions.

On the same topic, in 2022 we will likely see an acceleration to shift to circular Supply Chains where manufacturers will reuse and refurbish discarded products for resale, moving away from the traditional linear Supply Chain. 

Stricter goverment regulations on recycling and waste disposal will also push for this trend to accelerate in 2022 and business with sustainable practices will get the approval not only from the goverment but also from consumers.

All in all 2022 will see a continuation of some of the challenges faced in prior years, however business have had the chance to develop new ways to mitigate these challenges and are becoming more and more efficient in managing the current complex landscape.

This year that just started will for sure be full of challenges but will also be a year full of opportunities.