Question

1. How will continued supply chain disruptions impact manufacturing in the short-term (6 months)?   

2. How will continued supply chain disruptions impact manufacturing in the long-term (more than 6 months)

3 What choices are available to businesses in the long term? 4.

Create a table showing key price levels of consumer goods for a minimum of ten (10) companies impacted by Covid-19 from November 1, 2019 to April 1, 2020.

Answer 1

Introduction: Supply chain process ensures a systematic approach for distributing goods from the raw material producers to the end users operating via distributers. Any hindrance to normal functioning of supply chain can lead to serious consequences and depends upon the impact on supply chain. Let us see what unstableness it can create -

1. considering the short term effects: with supply chain process getting disturbed the cost of the material will see a sudden upsurge in goods prices. This depends upon the nature of effect that is created. It could last to a period upto 1 year. This in turn ignite black marketing of goods to take place where the same goods to be sold at much higher price. It create in security in the market where all the concerned parties worries of uncertainity. A total disrupt in the economy can be easily seen.

2. considering the long term effects: now since we are considering the long term effect we have to assume that all the parties are well aware of the situation and tries to maximize the profit by exploiting others. A proper working of supply chain management ensures availabiility of raw material on time,missing of the raw material can create business havoc and lead to production hault. This makes the manufacturers force to produce the material in demand by other means as soon as possible which resut in continued inflation in the market. Manufacturers try to squeeze every ounce of efficiency they can from the production process just be be competitive in the market. There are some stats which speak for long term effect - 1 to 4% increase in interest before taxes, 2.3% higher margin into skill based margin and 25% average reduction in working capital.

3. Available choices: Favourable business condition is soon to come until which the bsuiness in long run can seige their business continuity plans oppourtunity, keep a note of what actions have been taken by the governmnent and try identifying possible risks and try to map it well in advance.

4. the lsit is for indian consumer goods -

Goods	Earlier( November 1, 2019 )	Now ( April 1, 2020 )
Hand Senetizer	55 - 100 INR	100 + INR (mostly not available as of now)
Mask	30 - 150 INR	Not available or above 350 INR
Onion	20 INR/KG	starts from 45 INR/kg
Potato	10 INR/KG	30 INR/KG or more
Soyabean Oil	90 - 180 INR/KG	250 INR/KG
Sugar	27 INR/KG	50 INR/KG
Milk	30-40 INR/KG	50 INR/KG

Curd	25 INR/200 Gm	35 INR/200Gm
Almond	180 INR/500 Gm	250 INR/500 Gm
Flour	160 INR/5 KG	280 INR/5KG

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