Supply chain issues is a term we are hearing again and again in the news lately as shop shelves go unstocked and contractors struggle due to shortage of materials.
With this in mind it is more important than ever for businesses to ensure they are planning ahead.
Rising Costs due to Supply Chain Issues
Prices are rising and there is no view of when things may stabilise, with many retailers planning to increase prices before the Christmas period. (ITV News, Oct 2021)
Factoring these rising costs into contracts to ensure there are no losses as a result of price increases or delays that have occurred since pricing a contract to beginning works. Particular attention should be paid to any contract terms you may have with other parties in the process.
Problems in Construction
Construction news notes a 23% increase in costs this year. This, alongside driver shortages causing a shortage of raw materials such as cement, tiles, timber, and plaster, has massively impacted the construction industry in recent months.
It is advised that businesses put into place a contingency plan that may include looking at alternative suppliers, planning for when jobs are delayed due to materials and looking very closely at contracts they have with firms they sub contract to. It is always advised to get a qualified solicitor to look over any contracts and, if need be, look to negotiate terms if they feel this could have an impact on them as a business.
Companies who supply goods may also need to look into their stock levels and plan for the eventuality that may occur with reduced stock.
For manufacturers who need raw materials, it is advised to speak with suppliers, even if there is no problem currently. Discussing the continuity plans suppliers have in place to meet demand may help with planning for taking orders. Requesting updates on their supply chain can also be done.