03/03/2020

The Coronavirus Effect on the Global Manufacturing Supply Chain

Evaluate your supply chains to mitigate potential risks

China’s novel coronavirus (COVID-19) outbreak, which originated in the Wuhan, Hubei, province, has swept through the country’s major business and population centers and spread beyond its borders. While the coronavirus looms large, the impact on our region’s manufacturing and distribution sector and global supply chains hits closer and closer to home.

According to Dun & Bradstreet, the 19 hardest-hit provinces in China account for approximately 90 percent of all businesses operating there, and D&B researchers estimate that as many as 5 million businesses worldwide have a Tier 1 or Tier 2 supplier located in one these affected regions.

Slowly Coming Back Online

Some provinces outside of Hubei have started reopening their factories. Most, however, continue producing well short of capacity as travel restrictions hinder worker movement and access to raw materials. Even if suppliers can produce their goods, transportation and logistics challenges can keep products from going out the door. Maersk, the world’s largest container shipping company, recently cancelled more than 50 sailings to and from Asia due to low demand caused by the outbreak.

Please select this link to read the complete article from OSAE Strategic Partner Clark Schaefer Hackett.