By Alois Vinga
UK-based Zimbabwe procurement specialist Kuda Kadungure lamented supply chain disruptions hampering global markets amid calls for stakeholders to put in place reactive measures.
He made the remarks during the purchasing and supply chain live conference on Wednesday in London.
âCurrent trends have seen 94% of Fortune 1000 companies in the UK see supply chain disruptions due to COVID-19, 75% of companies have had negative or strong negative impacts on their business and 55% of companies plan to downgrade their growth prospects. ,” he said.
Kadungure, who is also responsible for procurement in the UK parliament, was the keynote speaker at the high-level conference.
âThe construction industry is going through a period of unprecedented uncertainty, volatile labor prices and shortages of materials. In the matrix, we also see a rapid increase in freight costs, container availability and global transportation challenges, âhe said.
The buyer said there was a shortage of global raw materials as the hardest-hit countries lacked staff and available transport capacity.
He said the blockade of the Suez Canal in March triggered a further increase in container spot freight rates, which saw the demand for container transport increase during the pandemic due to changes in consumption and consumer habits. the increase in electronic commerce.
Kadungure said the underlying causes are complex and include changing trade patterns and imbalances, capacity management by carriers and new ways of working by Covid19 and these combined factors have stubbornly resulted in shipping costs. high for companies that are sealed in contracts for the next 12 months that are here to stay.
âIn this context, there is a need for frequent reviews of supply chain risks with subcontractors and suppliers. Incorporating contractual clauses to deal with volatility – providing a means to collaboratively share the risks associated with this volatility can also be one of the solutions, âhe said.
He called for reviewing contractual incentives for contractors to meet program dates and design changes to allow for substitute materials while allowing longer mobilization and start-up periods for contracts.
The purchasing specialist has requested an initial order and payment from suppliers to secure manufacturing and delivery slots for critical hardware resources.
âProcurement actors can also assess and identify risks at every node in the value chain while creating a supply chain risk management framework to improve visibility and gain real-time visibility into operations. Monitor risks to provide real-time information to customers and contractors while increasing flexibility, âhe added.