CIPS Risk Index shows supply chain risk jumps...
According to the latest data supplied by CIPS with Dun and Bradstreet (D&B), Suppliers across Sub-Saharan Africa, Asia, Eastern Europe and Latin America pose an increasing risk to the businesses they work with. The CIPS Risk Index reversed its improving trend, moving to 78.2 in Q4 2014 from 77.9 in Q3. The Index helps sourcing professionals understand the risks to which supply chains are exposed.According to the quarterly report "The world opened up for procurement managers in Q4 2014 with an abundance of cheap oil and gas making suppliers in far flung corners of the world instantly more competitive. Combined with low commodity prices in everything from gold to soy beans, manufacturers at the top of the global supply chain have grown the complexity and length of their supply chains whilst reducing their input costs.
Declining commodity prices have also had a considerable unforeseen impact on suppliers at the very base of world supply chains. Whilst commodity producers themselves are the most obvious sufferers from the slump in prices, worsening trade deficits have slashed the value of currencies and cut the spending power of national governments which have had a negative effect on suppliers in certain parts of the world,
Suppliers in Asia, Latin America, Eastern Europe and Sub-Saharan Africa are particularly feeling the pinch, with reduced fuel costs opening up competition for contracts beyond national borders. This means there is a heavy downward pressure on the prices all suppliers can charge, a pressure which will impact the quality of their products, their delivery speed and the working environments for their employees" To see the lastest Risk Index new from CIPs