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On Supply Chains

By Michael D'Angelo

May 24, 2021

width=203Supply chain disruptions are occurring across myriad industries. What are we to make of the difficulties that AICC members are facing in their own supply chains?

The paper-based printing and converting industry’s primary raw materials, in their rawest forms, are timber and oil. Both these commodities are right here in North America—in abundance. The supply chains within those sectors, thus far in 2021, have themselves succumbed to an unusual number of natural and manmade events that have resulted in a supply shortage of paper, adhesives, and other related components.

Many business publications are trying to explain the causes and to suggest ways to make the global supply chain more resilient. It seems even members of Congress can agree that the government should look into ways to optimize conditions for “reshoring” the supply chain for U.S.-based businesses.

According to an article on BigCommerce.com, there are six types of supply chain disruptions: pandemics; natural disasters; transportation failures and delays; product problems; price fluctuations; and cyberattacks.

If you’re doing business in our industry as either a converter or a supplier, you are painfully aware that in 2020, and now 2021, we have checked the boxes for all six of the above categories.

Bob Novack, Ph.D., associate professor of business logistics at Penn State University, explains, “This pandemic is like a natural disaster, but it’s also not. The results of a natural disaster on the supply chain are usually localized and short-lived. In a pandemic, it’s global. It’s the rapid increase in demand that a pandemic creates that puts additional strain on suppliers.”

So, the pandemic serves as the driver of demand that exacerbates the effect of all the other disruption types. Weather events in the Southeast and Gulf states, where timber and oil are processed, created the localized impact. Semitrailers and drivers themselves have gotten more difficult to find as they chase the highest-paying loads. Product problems created by disruptions in other supply chains have hit the spare parts and repair markets. Price fluctuations (read rises) in paper, inks, and transportation are repetitive news. Cyberattacks hit three of the industry’s producers. To these we can add the already difficult manpower situation and the government competing with enhanced unemployment.

The potential solutions for protecting your company against supply chain disruption are not as apparent in our, dare I say, somewhat parochial industry—although some do source globally. I’ll share them for what they’re worth, courtesy of Gayatri Bhaumik, writing for Easyship: Create a supply chain emergency plan; build up inventory; conduct a supply chain vulnerability audit; identify backup suppliers; diversify the supply base; partner with a logistics expert; and adopt risk evaluation tools.

Our industry has a primarily onshore supply chain—one that reaches less far and has local reassuring alternatives. They’re all jammed. How many times have you heard “we’re all in the same boat” and “where else are you going to go” this year?

I’ve been in the industry nearly 40 years and have never seen anything like this.

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Michael D’Angelo

AICC President