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Report Finds Risk in Supply Chains Differs by Industry

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The Global Supply Chain Risk Report is a new joint study by Cranfield School of Management and Dun & Bradstreet. The report investigates actual supply chain risks faced by European companies with international footprints.

Increasing complexity and risk in procurement

Supply chains are becoming longer, more fragmented and increasingly complex, in turn increasing the level of risk exposure for businesses. Alongside natural disasters and geopolitical events like Brexit, there are also other – relatively low profile – events like fluctuations in exchange rates, changes to rules and regulations, or the bankruptcy of a key supplier that can impact organisations’ supply chains.

Procurement teams can use data and analytics, such as the findings from this report, to more effectively manage supply chain risk and protect the reputation of their business. Having access to a single, comprehensive source of information on supply chain relationships can help businesses to identify potential areas of exposure, act to minimise any negative impact, and plan to recover from events outside of their control.

About the report

Experts from Cranfield’s Centre for Logistics and Supply Chain Management have analysed data supplied by Dun & Bradstreet, drawing conclusions from around 600,000 anonymous transactions between European buyers and their suppliers located in more than 150 countries worldwide.

Supply risk was relatively stable in Q4 2017 but there were significant differences across key industry sectors.
 

The report looks at four key metrics (Supplier Criticality, Supplier Financial Risk, Global Sourcing Risk and Foreign Exchange risk) to assess supply chain risk and provide businesses with a view of trends within their industry sector, and across the wider economy. The focus industry sectors are Construction, Manufacturing, Retail, Transportation and Wholesale.

 

By analysing trends by sector, the report highlights areas for monitoring and consideration in procurement decisions.

Key highlights: Q4 2017

  • Supply risk was relatively stable in Q4 2017 but there were significant differences across key industry sectors
  • Dependency on key suppliers increased 7.7% on the previous quarter even though global sourcing risk decreased, indicating a cautious approach
  • The manufacturing sector was least dependent on key suppliers (38.1%), while construction recorded the highest comparable percentage (67.6%).

The full Global Supply Chain Risk Report is available to download from the link below.

A webinar covering the background of the report, the key findings and practical implications for procurement professionals can be found here.

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