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A few thoughts on supply chain issues

Offline Jerry D Young

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A few thoughts on supply chain issues
« on: October 12, 2021, 03:51:02 PM »
Supply chain issues have been on many people's minds a great deal here lately. Actually, ever since not too long after the Wuhan virus spread became a major concern, triggering shortages, the most notable ones being of toilet paper and hand and surface sanitizers.


They cleared up and the shelves began to fill again, primarily because the pipeline was still full and production was still occurring. It was the panic that caused the shortages, not any problems with the supply chain. At least, not with the current way the supply chain works.


In the past companies that sold products had a certain amount of many products in 'the back' and would restock shelves from that stock when needed. And manufacturers usually had warehouses where the product was shipped out, often daily, and the other end of the warehouse was being filled with new production, also often daily. That is no longer the case for the majority of products.


Now, JIT (Just In Time) deliveries are the norm. This is when the manufacturers, delivery systems (usually truck lines), and retail outlets looked at their needs (the retail outlets), their capacity (the trucking companies), and the demand (the manufacturers). Over a period of time, with some trial and error, some sophisticated forecasting techniques, and multitudes of calculations, the JIT system came into being.


The manufacturers produced the amount of product that their forecasts would be needed in future time frames. The trucking companies planned out their driver/truck/trailer availabilities based on how many loads they would need to carry based on what the manufacturers told them they would probably be shipping. And the retail outlets gave the manufacturers what they believed they would need and when, which was also passed on to the trucking companies.


A quite precise schedule of manufacturing was developed, with a quite precise schedule of trucking runs was developed, and a quite precise schedule of ordering specific quantities of products was developed. The product was made, put on a truck, and the truck showed up at the retail establishment just before the shelves went empty.


Any delay in the manufacturing process or in the delivery process means that products will not be there to be put on the suddenly empty shelves. Each part of that triumvirate has their own set of JIT elements that must work in unison for them to be able to meet their needs.


Manufacturers need the raw materials for the products, which means transportation from their suppliers and suppliers having the personnel to produce the raw materials. Transportation needs drivers, fuel, trucks, truck maintenance and repair, and clear roads in good repair. The retail outlet needs the personnel to unload the trucks and place the items on the shelves, put out the trash from the packaging, and the trash picked up to get it out of the way, and city services to keep the doors open.


And each of those have their own potential problems, which are dependent on many other pieces and parts of the total infrastructure of the United States. Any real disruption of any single element can cause problems, but of short duration for the most part.


However, key elements, especially electric, can cause cascading failures in many other parts of the infrastructure. Electricity is an integral part of modern society and its workings. What this means, at least to me, is that the supply chain not only affects individuals in getting what they need from a store but interlinking elements of all of the rest of the parts of many different infrastructures.


Everywhere I look, there is a problem with something that affects the infrastructure. And it seems that each one comes closer to shutting down more of other parts of the infrastructure, and for longer periods. Natural events and natural disasters; space events inside and outside of our solar system; people's general health, and especially now the Wuhan virus and what it is doing to societies around the world; politics in general and how the virus is being handled; various cycles that have been going up and down somewhat regularly, some of them for centuries, even millenniums.


I have drawn my own conclusions based on all of this, and have updated and modified my plans for the future to avoid as much disruption in my life from the problems, and source products that I use, some of which I really need, through other means than the regular retail system and regular utility infrastructure.


I urge everyone to take a hard look at everything around them and decide what they want to do about coping with it all.


Just today I found out about another major possible problem that could affect everything, on top of what has occurred with many industries and service industries recently. Like many of the others, a major maritime oil shipper has had many employees leave, rather than be vaccinated, including two full crews of one ship, which stops that ship. The two crews rotate over a certain number of days to keep the ship in service. And with the size of some of the oil tankers, even one ship out of service, there is going to be a huge delay in filling JIT orders of oil to refineries, fuel from refineries to distributors, and from distributors to end users.


Just my opinion.

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Jerry D Young

Prepare for the worst and hope for the best, and always remember TANSTAAFL

(TANSTAAFL - There Ain't No Such Thing As A Free Lunch - Robert A. Heinlein)