April 20, 2023 | Supply Chain Strategy
Supply chain volatility is now at its lowest since mid-2020. Moreover, green shoots are showing as demand improves in the United States, the European Union, and especially Asia, according to the March indicators of the GEP Global Supply Chain Volatility Index.
Demand by purchasing managers in Asia, specifically in China and India, for components and raw materials is rising strongly. While in the U.S. and Europe, demand, while still subdued, is now also improving – despite high inflation and interest rate – suggesting companies are past the trough seen in late 2022.
Interpretating the data:
Right now, it’s a buyers’ market and the ideal time to lock-in prices and terms. Decreased demand has helped resolve supply issues of materials as well as labor shortages and stockpiling. Now that there are early signs of improving demand, despite high interest rates, this is the ideal time for companies to lock in prices and key terms with suppliers and logistics companies for the coming months and even the coming year, because if demand continues to rise, prices will likely increase in step.
Learn more and request the full report at www.gep.com/volatility
The index is derived from S&P Global’s PMI™ surveys, sent to companies in over 40 countries, totaling around 27,000 companies. These countries account for 89% of global gross domestic product (GDP) (source: World Bank World Development Indicators).