The Importance of Contingencies
It’s important to have contingencies in place, no matter what you’re planning. Whether it be an investment, travel, or cargo logistics. No one knows that better, or does it better, than SecurCapital. We’re always steps ahead, and if you partner with us, you will be too.
Nothing has made the need for contingencies clearer than the supply chain snarls of the last few years. The pandemic completely changed the logistics landscape with the boom in e-commerce and brought a searing spotlight to shine on the weakest points of the supply chain.
China’s “zero-Covid” policy lockdowns resulted in a kneecap to the world economy that brought a complete stoppage of production of certain goods for weeks. Industries breathed a collective sigh of relief when those major economic and production hubs opened back up, but it brought the topics of near-shoring and re-shoring to the forefront of many future strategies. Ways to build more elastic and resilient supply chains were suddenly the star topics of conversations.
However, Covid cases are once again on the rise in China and lockdowns are being implemented in key hubs such as Zhengzhou, Tianjin, and Ningbo. Shanghai was presented as an alternative, but cases are on the rise there as well and have resulted in isolated lockdowns within the area. Full lockdowns could set us back where we were only a few months ago with a crippled supply chain, and a stranglehold on the world economy.
At the Communist Party Congress held last week, President Xi said he had no plans to deviate from the current “zero-Covid” policy.
Even with congestion starting to ease at ports, if the lockdown trend in China continues, we could see major disruptions to the supply chain once again. From raw materials, to electronics, the US still relies heavily on Chinese imports.
Watching these trends develop, it’s important to revisit production models and logistics plans to build contingencies within those strategies and stay ahead of the disruption to keep your business growing and your goods moving. Reach out to your reliable, trusted partners at SecurCapital today to rise and meet these challenges together.