'Invest in sustainability and resilience when there is less pressure'

Developments in the supply chain are visualized in our supply chain heatmap. The heatmap shows along the line of various indicators (on freight, production, prices and uncertainty) where the pressure on supply chains has increased or decreased in recent months. The starting point is the beginning of the COVID-19 pandemic, when supply chains faced major disruptions. Russia's invasion of Ukraine also turned the heatmap red. By the end of 2022, the pressure had subsided, and indicators had turned green due to reduced demand.

Using calmer times to reassess supply chains

PwC experts Rolf Bos and Annemieke Moerkerken understand that from an economic perspective, reduced pressure is not always good news for companies, as they may see their sales decline or be left with large inventories. Still, they urge companies to use this calmer time to reassess their supply chain and make investments in it. 'As a company, you don't have to be focused on all kinds of issues in your supply chains all the time now, and you have room to maneuver,' says  Rolf Bos.

New reporting requirements reveal bottlenecks

'In this context, making supply chains more sustainable remains a very important topic,' adds his colleague Annemieke Moerkerken. 'The new European reporting directive CSRD, which will come into force for large companies next year, compels companies to be more transparent about their impact on the environment, climate and people in their supply chains. Investments in sustainability are also investments in resilience'.

Investments don't have to be big

Investments do not always have to be large, emphasize Moerkerken and Bos. Moerkerken: 'Think of installing dashboards that enable you to better anticipate possible bottlenecks at your suppliers or even predict these bottlenecks on the basis of a large amount of data.'

Rolf Bos: 'In the summer, water levels in the rivers are often lower and sometimes even too low. You can monitor and teach your algorithms to make predictions about it. If you depend on waterways, that allows you to look for new routes or arrange alternative transport in time. That's how you prevent disruptions. Often companies only really get moving when things go wrong somewhere. I would say: act on the lessons learned earlier.'