The other day I had lunch with Tim Maloney, a real supply chain development expert. Our conversation led to the trade war with China. All of us know that the world is becoming a smaller place with every passing day. International events including import tariffs, Hong Kong riots, the human rights atrocities in Xinjiang, China and potential confrontations in the South China Sea, not only impact our political relationships, but will also determine how, and with whom, we conduct business in the future.
Supply Chain diversification is not a new phenomenon. Tim Maloney said, “large companies around the world have weighed the value of vendor consolidation versus the potential risk of supply chain disruption. These larger companies have the resources to expand their footprint and diversify in order to minimize risk. Not so, many of the smaller businesses in the $15MM to $100MM range.”
Tim also told me “they often lack the expertise and in-house resources to successfully navigate a country-to-country expansion of operations or sourcing efforts. The reality is, now more than ever, hiring these valuable resources must be considered. The United States government offered 1-year tariff exemptions to qualifying businesses with the hopes that these companies would begin to investigate supply alternatives elsewhere. Some used this time to hope and pray that a trade deal soon would be signed and the whole tariff issue would blow over.”
Unfortunately, as we’ve learned in recent weeks this may not be the case. As we closed out conversation, we discussed the fact that supply chain flexibility is now more important than it has ever been. Tim concluded with this, “the world will continue to narrow and the events that had very little impact on our smaller companies in the past may be the reason some will lack future viability and risk going out of business.”
If you or someone in your company is responsible for supply chain, I’d suggest contacting Tim Maloney. Why not speak with someone who knows how to get it done?
Contact Tim Maloney via LinkedIn or CareerWebfolio.
Listen to full Podcast discussion below!
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