According to supply chain risk and performance management specialist Achilles, manufacturers across a variety of sectors are being urged to consider ‘fattening their inventories’ as quickly as possible in order to mitigate a prolonged disruption to global supply chains. The company’s latest report on the resilience of global supply chains indicates that high risks are evident across almost all sectors and geographies.

The Q2 Achilles Supply Chain Resilience Index (ASCRI) is showing a score of 39.8, the first time the figure has fallen below its 40-point high-risk threshold — and further declines in resilience are expected. The report says: “Anticipation of a protracted war in Ukraine and the re-emergence of Covid-19 in China are bringing about further logistical challenges that have led to a desperate need for procurement professionals to mitigate the potential impact of supply losses over the months to come.

“Where possible, bringing the next order forward can help manufacturers to potentially afford themselves one extra stock cycle and the time to find alternatives if supply is lost; and while many will be concerned about the cost of an extra stock cycle in the short term, the cost premium is still expected to be less than that caused by large-scale stock-outs.”

Katie Tamblin, Achilles’ chief product officer, said: “Procurement professionals work tirelessly to plan contingencies should supply chain disruption arise, but what happens when there are so many risks that some become unavoidable? With the prolonged conflict in Ukraine and extremely tight restrictions on movement in China, the prospect of further disruption and even higher costs seem almost inevitable.

“Therefore, it would be wise for manufacturers to consider acting now to mitigate even greater risks months down the line. By bringing planned orders forward as much as possible, that extra stock cycle and the extra planning time it brings could prove to be an invaluable way to find alternative sources of supply.”

The ASCRI measures changes in supply chain risk by country based on six categories: economic, environmental, labour practices, legal and governance, resilience, and safety and security. Each country’s score is derived by combining the Achilles’ scores of suppliers based in the country with that country’s overall performance in those six categories.

“This ‘framework’ is then supplemented by a range of global measures, including shipping and ‘sentiment data’. Further details of the report can be found at the website (www.achilles.com/industry-insights/ascri).