Inflation Across the Supply Chain

If you do a Google search on “inflation,” you get back more than 46 million hits, with many news items published in just the last few weeks. Simply put, many economists, business leaders, and consumers are concerned about rising inflation. Supply chain leaders are concerned too.

In June, we asked our Indago supply chain research community, “How concerned are you (or your company) about rising inflationary pressures across your supply chain?” More than three-quarters of our member respondents (77%) are “Very” or “Extremely” concerned about rising inflationary pressures across their supply chains; the balance are “Moderately” concerned.

Source: Indago, June 2021 survey (n=22)

“While there is some wage pressure due to challenges in hiring (all positions), the issues with raw materials and their impacts on pricing are massive,” said one Indago member. “We are seeing year-over-year increases in the triple digits. Anything with resin or steel especially. We’re experiencing major cost increases with the only hope being stabilization later this year or early 2022.”

Another member commented, “We are experiencing inflationary pressures in all areas (materials, goods, services, labor, etc.). Currently, raw materials and freight are of most concern. We are reducing service requirements, where possible, but there aren’t many other options other than raising prices on finished goods, which is happening early and often.”

Here are some other value-added comments from our Indago members, who are all supply chain and logistics professionals from manufacturing, retail, and distribution companies:

“Capacity across all modes of transportation is getting extremely tight; there’s simply not enough vessels or trucks to move what needs to be moved, which will only create inflation and lead to longer lead times.”

“We are working with our customers on indexed pricing related to commodities, as well as price increases relative to labor shortages, freight, higher costs for everything we use to make our widgets.”

“Crazy inflation in the transport markets. Supplier relationship and performance management will counteract some inflationary pressure, but not all of it.”

We also asked our Indago members, “How would you characterize current inflationary pressures in the following areas?” The results are available to Indago members only.

Source: Indago, June 2021 survey (n=22)

How concerned are you about rising inflationary pressures across your supply chain? Where is inflation having the greatest impact? Post a comment and share your perspective!

Join Indago

If you’re a supply chain or logistics practitioner from a manufacturing, retail, or distribution company, I encourage you to learn more about Indago and join our research community. It is confidential, there is no cost to join and the time commitment is minimal (2-5 minutes per week) — plus your participation will help support charitable causes like JDRF, American Logistics Aid Network, American Cancer Society, Feeding America, and Make-A-Wish.

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