Markets

The Broken Supply Chain, and How Businesses Can Fix It

Michael Sinensky, CEO at WeShield

It’s the perfect storm, but without George Clooney and Mark Wahlberg to entertain us.

The supply chain in America has broken yet again, with many reasons for its demise. Climate change has caused volatile weather and storms. A global pandemic requiring every citizen to stock up on PPE has put a strain on manufacturing. There’s a lack of materials and ingredients, and factories abroad are backed up and overwhelmed from pivoting to new pandemic products. The list goes on: our dependence on foreign products, traffic-jam-packed west coast ports, a lack of reliable truckers and vehicles. A nationwide covid vaccine or testing mandate for large businesses affecting close to 100 million people. Finally, gift-hungry children and their parents hoping that Jeff Bezos-Claus delivers their packages on time. All of these factors are combining to most likely ruin Christmas and the holidays for those who will procrastinate this season. 

As the CEO of a medical supply and PPE company called WeShield, I have more significant concerns related to public health and safety. Those in charge of purchasing PPE and medical supplies for health care institutions must be mindful of all these factors causing shipping delays and logistical nightmares, which will require early and efficient plotting and purchasing to keep medical staffers safe and healthy while they battle the remnants of Delta variant fueled covid cases on top of the typical flu season at the same time.

Please heed this warning. There is a simple fix regarding PPE and medical supplies:

  1. Buy now, purchase fast, and order more than you need to last you through the winter.
  2. Don't procrastinate, and don't try to order just the perfect amount to satisfy a regular month's needs. Order more than you need.
  3. Expect the unexpected.

Heads of hospitals and health care institutions need to close their eyes for the next four months regarding over-spending. With inflation skyrocketing, combined with scarcity and shipping issues, prices are quickly on the rise. It is not the time for penny-pinching. Remember the adage, “you get what you pay for.” Well, now that saying holds more accurate than anything else regarding life-saving PPE, testing and tools your staff will need to keep your institutions afloat. If you have your purchasers trying to save pennies, you will likely find them bringing in sub-standard products for the time being. 

CNN’s recent exposé on the Asian glove market proved so many products got past an extremely busy FDA and customs agents during the pandemic, leading to medical warehouses here in the states likely defective housing goods. So purchasers must be careful and be prepared to spend appropriately on name brands versus experimenting with new companies that just popped up and do not care about producing high-quality goods and developing strong relationships with purchasers for future business. 

Once you have the proper high-quality goods in-house, that’s when the fun begins. With the majority of the adult population in the country being vaccinated and severe covid cases currently on a steep decline, a business owner or a hospital boss might think it’s time to breathe a sigh of relief. 

Now for more bad news. If you think you’ll have an easier time of running your business or health care facility free from burdensome regulations after the worst of the pandemic, know that luck is not on your side. The government has mandated all government employees and staff of companies with 100 workers or more to either be vaccinated or frequently tested for covid. 

Let’s forget about the extra expenses imposed on the organizations. Just when it comes to following the testing mandates, I'm sorry to say, you are in trouble. The president's order has now put massive stress on the test kit industry. What was supposed to start in November has now been pushed to January 4th. The silver lining around the push: companies that made all those preparations for the November start date at least have a head start on what is coming. 

Firstly, there wasn't enough supply to begin with for all big businesses that are mandated to test regularly. Secondly, the president's administration continually buys up most of the available stock to test government employees. Thirdly, the only place the general public can buy tests is from retail giants like Walmart, CVS, and Amazon. But good luck buying more than a dozen kits there with purchasing limits set in place. 

So to recap, the government is threatening heavy fines for not testing employees, while taking most of the available supply away from the companies that they are requiring to test employees. It’s another head-scratching bureaucratic moment at the worst possible time with all of our supply chain woes. 

This winter will prove one of the worst times most of us will ever witness regarding supply chain issues and shortages. Be prepared by stocking up early and often to weather the perfect storm descending upon this country, or you’ll receive coal in your stockings (if you can even find it).

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.