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April 2023 - Industrial

7 in 10 manufacturers say biggest driver of supply chain disruption is higher raw material prices: A survey by Make UK asking manufacturers about supply chains has revealed that 71% believe the greatest driver of supply chain disruption is raw materials prices, followed by high transportation costs (69%) and energy costs (68%).

Furthermore, 70% of the manufacturers polled in the survey -- which was launched at the Make UK National Manufacturing Conference -- said they are experiencing all three of the top challenges listed, with almost eight in 10 respondents saying that they believe supply chain issues could pose a strategic risk to their business over the next couple of years. Just 3% of respondents said that they do not expect to face supply chain challenges either this year or next.

In a bid to overcome the ongoing volatility, the research found that eight in 10 manufacturers have diversified their supply chains (81%), with almost a third reporting that they have boosted the number of suppliers they use to reduce risk. However, two in five companies reported doing the opposite -- reducing the number of suppliers used in order to secure longer-term agreements to guarantee supply.

Almost half of the companies polled (47%) reported increasing investment in supply chain resilience over the last 12 months, while around one in five are looking at how they can do so.

Monitoring supply chains

Looking at the most popular tools for monitoring supply chains, dashboards and analytics were the most popular for 46% of businesses. The research also revealed a limited interest in AI and machine learning tech (8%), robotics and automation (7%) and augmented and virtual reality (4%).

In addition, two in five respondents said they do not use technology at all to monitor their supply chains, while around a quarter said they don't monitor either up or down their supply chains.

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