Supply Chain on the Verge of Collapse Ahead of the Holiday Season

October 15, 2021

October marks the beginning of the biggest shopping season of the year, but disruptions to the supply chain caused by the COVID-19 pandemic may dampen holiday cheer. 

The pandemic's role in falling inventory levels

As it stands, consumer demand is currently far outweighing available supply. Therefore, myopically positive metrics for the economy, such as the growing S&P Retail Select Industry Index, fail to capture the ever-worsening issue of distribution and logistics.

graph depicting increasing U.S. retail index despite supply chain woes

Source: Bloomberg

U.S. retailers are currently experiencing an overwhelming dearth in stock levels that is far below historic levels of supply. To compensate, some companies are resorting to stocking shelves with products that were designed two years ago. As a result, it is highly unlikely that ardent shoppers will have access to all of the goods they want for Halloween, Thanksgiving, and Christmas. 

graph depicting fall in inventory levels at U.S. retailers

Source: Bloomberg

Why this matters

The supply chain is not designed to function during a once-in-a-century health crisis, but the failure of key stakeholders to collaborate and solve the problem is what prevents the situation from improving. After three decades of the same global economic model, experts are now questioning investment decisions at ports, management of human capital, and improper integration of the various supply channels. For example, although a new tool called port optimizer--which forecasts three weeks of incoming cargo to more efficiently plan the fulfillment process--has been introduced, only two cities in the entire U.S. are testing the system.

All units of the supply chain process must work together as a relay race, but currently, there is a slapdash approach to managing complications related to the pandemic. 

Related: How Technology Can Help Global Supply Chain Disruptions 

How G2 can help solve this problem

Logistics and supply chain management must be a seamless process, and automation through technological integrations makes this possible. 

G2 hosts an extensive reserve of supply chain management software products with real user reviews to help buyers choose a vendor that best suits their business needs. This can help prevent the dysfunction that is currently plaguing the global economy.

Below are several software categories that help with logistics and supply chain management:

Through incorporating software into businesses’ operating procedures, the pandemic doesn’t have to tank the economy.

Supply Chain Management Software ➜

Supply Chain on the Verge of Collapse Ahead of the Holiday Season Disruptions caused by COVID-19 threaten the short- and long-term stability of the global supply chain.
Anthony Orso Anthony is a Market Research Analyst specializing in supply chain and logistics, as well as data science applications in the industry. Prior to joining G2, Anthony worked in the research and strategy department of advertising. When Anthony isn't studying for his master's program in data science, he enjoys film criticism, true crime, and playing classical music on his violin.