FuturePrint Vision Report: Supply Chain Update
The perfect storm
There’s no escape from news stories covering current supply chain issues - the New York Times has even recently appointed someone just to cover supply chain news. We’re all hoping to see improvements on the horizon, but is it something we can expect any time soon? Unfortunately Kellogg CEO, Steve Cahillane, doesn’t believe we’ll see a return to our normal levels until 2024 due to the sheer disruption the world has encountered over the past two years.
In the print industry, we’re not just battling with significant paper and ink shortages, but shipping delays too. Factory shutdowns due to China’s lockdowns are causing a major headache in this department. However, the entire issue surrounding supply chains can’t all be attributed to COVID-19. Warehouse, distribution, and driver shortages were becoming increasingly challenging even before the pandemic hit, and adding COVID to the mix brought permanent factory closures, lockdowns, and labour shortages around the globe. Combined with the effects of Brexit starting to take hold in the UK, the events unfolding in the last few years have been described as the ‘perfect storm’. Documents released with Rishi Sunak’s October 2021 budget confirmed that ‘supply bottlenecks have been exacerbated by changes in the migration and trading regimes following Brexit’. So what are businesses doing differently to confront the issues?
Debbie Thorp, Global Inkjet Systems, explains that “keeping customers supplied is critical, so our purchasing and operations teams have purely been focussed on securing components. That effort is paying off, but it’s still very challenging.”
Inflation
It’s not only supply chain woes that businesses are overcoming either; inflation in the UK is the highest it’s been for three decades at 7%, with the USA also seeing a record figure of 7.5%, the highest the country has seen for forty years. Rising fuel costs compounded by Russia’s war in Ukraine means we can only expect to see this stay as high as it is, or potentially rise further. However, the Bank of England’s base rate rise does seem to be steadying inflation for now and the Printing Outlook survey revealed that 63% of printers were able to increase their output levels in the fourth quarter of last year.
Looking ahead and the road to recovery
With all this in mind, it’s a great time to remember that our industry is a close-knit family and at FuturePrint especially, we are a community. Around the world, we’re all in the same boat and should make ourselves available to support one another. And when it comes to making business decisions, as long as we’re factoring in extra time for receiving materials and working the higher price of raw materials into our fiscal plans, we should see a prosperous 2022.
In the Vision Report 2022, we spoke to Marc Graindourze, Business Development Manager Industrial Inks at Agfa who shares our optimism about the year ahead, “we are confident and we plan for a very good 2022, followed by a stable 2023.”
At FuturePrint, we’re keeping our fingers crossed and our eye on supply chain developments as we move forward.
Download the 2022 Vision Report in full now.
We’ll be discussing current challenges and much more at the FuturePrint Leaders Summit in Geneva - find out more about the event here.
