Procurement professionals should make supply chain decisions based on resilience to manage the impact of coronavirus panic buying.
Richard Wilding, professor of supply chain strategy at Cranfield School of Management, told SM it might lead to higher prices but resilience was critical.
“Focus on resilience. It might cost more in the long run but they [buyers] need to focus on, and make their decisions, based on resilience,” he said.
“Agility is essential, as the speed in which they can act to change is important. They may need to act quickly and being agile is essential to do this successfully. For those working with suppliers, you should understand where your supplies are coming from as should you need to you can then speak to suppliers directly.”
Wilding’s warning comes as 12 UK supermarkets asked customers to avoid panic buying supplies in bulk and shop considerately. Retailers including Sainsbury’s, Tesco, and Asda assured customers they are working at full capacity to keep the flow of supplies to their stores.
In a joint letter the retailers said: “We are working closely with the government and our suppliers to keep food moving quickly through our system and making more deliveries to our stores to ensure our shelves are stocked.”
Last week, the Department for Environment, Food and Rural Affairs (Defra) announced it would extend delivery hours for supermarkets and retailers to meet customer demand.
The new measures will help retailers “increase the frequency of deliveries to their stores and move stocks more quickly from warehouses across the country to replenish their shelves”, Defra said.
Wilding also warned of “supply chain parallel interaction”, when seemingly unrelated supply chain channels are disrupted.
He said panic buying of paper kitchen towel and baby wipes as alternatives to toilet paper would have the knock-on effect of disrupting sewage treatment and the supply chains of water companies.
“If kitchen towels, baby wipes or industrial papers are used as a replacement for toilet paper, our sewage systems could readily become blocked with the resulting chaos and increased health risks associated with this. Ultimately, water companies may not have the infrastructure and equipment to unblock the sewer system,” he said.
Wilding added consumers were also turning to building hardware suppliers to purchase face masks as chemists and pharmacies run out, preventing those in the construction industry purchasing crucial protective equipment for their job.
“Companies can’t expect their staff to continue without it and regulations place a duty of care on every employer to provide the appropriate safety equipment.
“Without such equipment, employees are unable to work and companies are subsequently unable to undertake work. UK companies who supply these sectors are starting to feel the strain on certain protective equipment items and this needs to be monitored very carefully.”
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