Analysis: The supply chain in the time of coronavirus
A piece written for IBC365 at the end of March looking at how, with Covid-19 impacting all areas of the media and broadcast sector, supply chains may suffer due to the growing pandemic.
Here’s a snippet:
A big part of the problem is that the Just in Time manufacturing system that has been embraced by most industries since it transformed large-scale physical manufacturing in the latter part of the 20th century, relies on the swift flows of goods. Once that flow is interrupted then it creates a cascade all along the chain. As this is the first genuine global disruption to test the model, no one knows quite how it will react.
The optimistic scenario sees it as a pause of whatever length followed by a swift taking up of the slack and a rapid return to pre-virus levels of production. The more pessimistic one models events along the lines of a shockwave motorway traffic jam where one car touching its brakes can cascade into a lengthy tailback as the shockwave travels backwards through the traffic.
“Production slumped in China during late January and most of February as government measures put in place to control the spread of COVID-19 led to many factory closures,” says Chris Evans at Futuresource.
“The greatest impact on manufacturing is expected to be felt in March and April as component inventories dwindle. Based on our broadcast equipment trackers we have already seen a shortfall in sell-in of certain products to Europe in February. It is likely that there has been a similar situation in other regions leading to a build-up of backorders.”
Avid was one of the first broadcast vendors to sound the alarm. On 4 March it issued a statement saying that its supply chain remained operational and continued to produce and deliver product to its global warehouses providing product availability across most of our product offerings.
However, it then went on to caution that it did “expect some level of disruption, including possible delays in scheduled deliveries due to component availability and restricted freight transportation as well as potential delays in projects or delivery of services due to travel restrictions.”
On 24 March it gave IBC365 a slightly terser statement. “Sorry we’re not able to comment on the state of our global supply chain right now,” the company said. “It’s still too early to comment on this. We’re entirely focused on serving our customers as they transition their operations to increase online collaboration.”
As with anything written on the coronavirus outbreak, particularly at the start of it all, this has probably dated a fair bit by the time you read it yourself, gentle reader. But read it you can if you are interested here: Analysis: The supply chain in the time of coronavirus
