If there ever was a strategic topic of critical importance no matter your position in the supply chain, it is keeping an eye on global markets. We’ve worked with clients who ONLY source materials, components and products from U.S.-based suppliers. Yet, even they must pay attention to global markets to thrive. Are you making this a priority?
There are countless reasons to stay informed of global markets. First and foremost, we live in a global society. It isn’t practical to go through a day without coming into contact with products, services, people, currencies and more from around the world.
A few additional reasons to keep an eye on global markets:
- Interconnected world – We live in an interconnected world. A political risk in Asia can impact the price of your materials. Or, a shortage of oil or gas (as an example) in one country can impact the price and availability elsewhere.
- Economy & currencies – Currency exchange rates will have an impact somewhere in your supply chain whether or not it touches your product or service.
- Tariffs & trade – Tariffs certainly can have an impact. The impact can be far reaching and can be from areas that don’t directly touch your organization. In this case, you might have short-term pricing impacts or long-term strategic impacts of where to locate manufacturing or which countries and markets to pursue. Hopefully, you are considering both.
- Global customers – There might be unique opportunities in one part of the world to utilize your product or service with a greater benefit realized than in another part of the world. Are you considering your options and expanding your mind to the possibilities?
- Risk – There’s no doubt that mitigating risk alone is reason to keep track of global markets. For example, earlier in my career when there were issues getting materials out of Brazil, we wouldn’t have been able to service customers if we hadn’t planned for a backup supply elsewhere in the world. Similarly, we would have gone out of business if we relied on only local suppliers when a major hurricane hit our manufacturing plant. Every local business was under water except us and even with a plan we were affected – were shut down for a short period of time because our employees could not get in or out of our facility.
Keeping an eye on global markets can become a full-time job. Clearly, few, if any, clients can afford that. Thus, pursue ways to collaborate with customers, suppliers, trade associations and more to leverage insights. Minimally, put aside some time on a daily basis to watch for key trends.