HOW SUPPLY CHAIN RISKS IMPACT COMPANY BOTTOM LINE
A recent research report on the risks of supply chain shows us some startling statistics. Since most manufacturers outsources a fair amount of work to “ their suppliers and vendors” the chance of “ supply chain disruption, delays or external natural factors is always omnipresent .
• However just 25% of a typical company’s end to end supply chain is being assessed for risk auditing The risk factor
• 90% of respondents do not formally quantify risks when sourcing production • In a survey 45% firms indicated a looss of revenue due to supply chain distruption
• 14% of companies revenue loss on account of supply chain distruption exceded one million euros • Supply chain distruption caused shareholder returns to decline by 33-40% over a 3 year period
• Share prices of companies that experience delay and disruption in supply chain tended to be more volatile ( on average around 13.5% higher)
• 58% of firms indicated that a loss of productivity as the main reasons for supply chain disruptions • while 11% firms believed that supply chain risks and delays lead to increase in cost of production
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