{"id":10273,"date":"2022-07-05T09:48:21","date_gmt":"2022-07-05T16:48:21","guid":{"rendered":"https:\/\/www.qad.com\/blog\/?p=10273"},"modified":"2022-07-05T09:49:46","modified_gmt":"2022-07-05T16:49:46","slug":"summer-solstice-your-supply-chain-knows-winter-is-coming","status":"publish","type":"post","link":"https:\/\/www.qad.com\/blog\/2022\/07\/summer-solstice-your-supply-chain-knows-winter-is-coming","title":{"rendered":"Summer Solstice? Your Supply Chain Knows Winter is Coming"},"content":{"rendered":"<p>[vc_row][vc_column][vc_single_image image=&#8221;10274&#8243; img_size=&#8221;full&#8221;][vc_column_text]<span style=\"font-weight: 400;\">In the Northern Hemisphere, we recently celebrated the Summer Solstice, which means the start of calendar summer and the longest day of the year. I always chuckle on the day after the solstice as I think of a fond childhood memory.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">On the 22<\/span><span style=\"font-weight: 400;\">nd<\/span><span style=\"font-weight: 400;\"> of June (typically the day after the solstice), my father would come in after work dressed like he was ready for a blizzard. He had on a hat, cap, heavy gloves, a winter parka and boots, etc. We\u2019d look at each other and say, \u201cThe poor guy has gone mad. It is 85 degrees outside and dad is dressed like an Eskimo.\u201d Then we heard the words, \u201cDays are getting shorter, winter\u2019s coming!\u201d It was a ritual he did every year, and we loved it. What was even funnier was when he\u2019d do the reverse at Winter Solstice and come in wearing shorts saying, \u201csummer is coming, days are getting longer.\u201d<\/span><\/p>\n<p><span style=\"font-weight: 400;\">So now you might say, great story, Steve, but, what is the point?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The point is that for those now in summer, the furthest thing from most people\u2019s minds is winter, the holidays, elves and Santa Clause. However, if you manufacture or transport goods, especially those that have any seasonal value in the winter, you better start preparing now because the days are now getting shorter and the disruptions that are impacting the market today will extend into the future. Winter is coming and it might not be much fun for the supply chain.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Welcome to Year Round Seasonality<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Many retail store shelves are empty or at least thin on product. This is happening globally. It is similar to what we saw at the beginning of the pandemic. Problems that were simply starting before Covid have festered and now exploded. The pandemic masked the issues. Some of the hardest hit product categories are the summer seasonal items due to supplier, manufacturing and supply chain problems. There is no indication of a letup for the upcoming Autumn and Winter periods. So, as we sit here in the Northern summer basking in the sun, make sure you know where those boots are, Winter is coming. With the expanding value chain, dramatic changes in consumer behavior and on-line buying, many seasonal items can now be purchased year round. The changes to all types of product sales during the two plus years of the pandemic have rendered historical forecasts useless.\u00a0<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">3 Supply Chain Seasonality Trends and Issues<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">So what are the trends and issues that might just give the <\/span><a target=\"_blank\" href=\"https:\/\/www.qad.com\/blog\/2022\/04\/3-questions-supply-chain-leaders-should-be-asking\" rel=\"noopener\"><span style=\"font-weight: 400;\">supply chain<\/span><\/a><span style=\"font-weight: 400;\"> (and Santa) more headaches than the usual winter problems? Here are three hot buttons of today:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The Global Economy and Covid-19<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Transportation Issues<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Packaging Materials<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">We have been wondering since the start of the pandemic when the proverbial shoe was going to drop in terms of the economy. It is actually shocking that a recession had not started sooner. But here we are on the brink of serious economic turmoil. Like many of the supply chain issues that took time to explode since the pandemic, the economy is now following suit. Fuel prices are insane and the impact is being felt in more areas than at the gas pump. Industries relying on oil are also feeling the sting.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In the United States, many states joke about having two seasons; Winter and Road Construction. Well, the Construction season is being interrupted as the oil issues are impacting the asphalt market. The war in the Ukraine has impacted multiple markets like grain and basic agricultural commodities. The effects are rippling through the economies of manufacturers. Pandemic labor struggles were starting to improve with workforces ramping up to pre-pandemic levels and are now in jeopardy again as economic layoffs loom. This has impacted the summer seasonal items that have not been delivered on time. These issues are forecasted to continue. To make matters worse, weather issues such as drought will impact food markets and other goods reliant on raw materials in future months. Winter is coming.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Transportation issues have been a cause of many supply chain issues but has been a victim of disruptions as well. There is a global shortage of trucks and drivers that is causing delays in the transport of products up and downstream of the manufacturing supply chain. Some of the same trucks that are used to move finished goods are used to move raw materials and work in process items between manufacturing facilities. This has caused delays across the supply chain. Another major transportation problem is that there are more Less Than Full Loads on the road today because of the immediate delivery of purchased goods spurred by on line buying.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">One interesting factor here is not simply to get consumers products the next day but the need to redeploy inventories from different warehouses and DC\u2019s to match the source location. Waiting to fill a truck would cause late orders. The issue is even further complicated when talking about refrigerated trucks which are in short supply when they are full, never mind when they are not. The surge in fuel prices have wreaked havoc on the industry to where carriers prices have soared putting a strain on manufacturers and suppliers to have to raise costs. The primary recipient of the brunt of these increases is typically the consumer and that causes a change in purchasing habits. With no real end in sight to the transportation issues, the outlook for the holiday season a mere few months away is not looking good. Winter is coming.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Are You Prepared for Winter?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">So how does a manufacturer ensure that amidst all that has happened, continues to happen and hasn\u2019t happened yet, make sure they are prepared for winter. To be honest, the <\/span><a target=\"_blank\" href=\"https:\/\/www.qad.com\/data-sheets\/qad-dscp\" rel=\"noopener\"><span style=\"font-weight: 400;\">planning<\/span><\/a><span style=\"font-weight: 400;\"> for the holiday season of 2022 should have been in the works prior to the solstice. So walking in on the 22nd of June with your boots on would most likely have been too late. However, the future is still ahead.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The good news is that up and down the supply chain these problems are being dealt with and you are not alone. What you need to do is start working on tomorrow&#8217;s problems today. Even though we do not know what they may be. You do this by being adaptive and nimble. Analyzing your supply chain network and modifying the pieces to be adaptable to the surprises. Ensure that co-packers, 3PL locations are in the areas where your value chains are expanding. If you are not using Digital Twinning to model your supply chains, start now. Promotions, deals, store brands are all ways to combat economic uncertainty, make sure you have the processes and tools to plan and manage your promotions and trade spend. But most importantly, do not turn your back on Sales and Operations Planning.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The concept of <\/span><a target=\"_blank\" href=\"https:\/\/www.qad.com\/blog\/2022\/05\/3-critical-planning-areas-every-sop-process-should-address\" rel=\"noopener\"><span style=\"font-weight: 400;\">S&amp;OP<\/span><\/a><span style=\"font-weight: 400;\"> has been around now for close to 20 years but it has evolved and still needs to evolve. Inventory needs to be a critical piece of the S&amp;OP mindset. And, it needs to become a mindset not just a process or thing. Today\u2019s S&amp;OP or even Sales and Inventory Operations Planning (SIOP) needs to include your entire ecosystem, not just all functions within your walls. S&amp;OP broke down the silos internally. Today&#8217;s S&amp;OP with SIOP, will break the walls down throughout your entire network and enable you to be adaptable and nimble. Your new found nimbleness will let you change from boots to shorts and back to boots in no time. Winter is coming. No problem.<\/span>[\/vc_column_text][\/vc_column][\/vc_row]<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[vc_row][vc_column][vc_single_image image=&#8221;10274&#8243; img_size=&#8221;full&#8221;][vc_column_text]In the Northern Hemisphere, we recently celebrated the Summer Solstice, which means the start of calendar summer and the longest day of the year. I always chuckle on the day after the solstice as I think of a fond childhood memory. On the 22nd of June (typically the day after the solstice), my [&hellip;]<\/p>\n","protected":false},"author":35,"featured_media":10274,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[182,199],"tags":[24,175,2177,2230,2229,92,118,223,557,2231],"class_list":["post-10273","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-featured","category-manufacturing-trends","tag-manufacturing","tag-sop","tag-seasonality","tag-siop","tag-summer-solstice","tag-supply-chain","tag-supply-chain-management","tag-supply-chain-planning","tag-value-chain","tag-winter-solstice"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.7 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Summer Solstice? 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