The tsunami that we have been holding our breaths for all year now seems to be hitting. We are potentially looking at the perfect storm of Xmas, CNY, an increase in worldwide demand, and the effects of almost a year of reduced worldwide production.
We have already updated you all on the freight and container issues we are seeing in both foreign and domestic ports. These are impacting the manufacturing sector and giving us lots of challenges to deal with.
Supply Chain Focus
All of these challenges focus our attention on our supply chains. It is those that have developed or are developing local capabilities that are making big gains at the moment. Fero has a strategy to focus on our local manufacturing capabilities and to ensure that we have as much local sourcing as we can achieve.
The attached is an example of what is becoming a very common communication from suppliers. I am sure it is not a surprise to many and further underlines the need for good forward planning going into 2021.
We have seen this coming for some time now and have been focussing on forecasting and working with our customers to make sure that we have planning in place to ensure that we can supply on time.
For those customers that are forecasting monthly and have a reasonable level of accuracy, we are able to deliver mostly on time. Unfortunately, there are still a few issues that are hitting us, but these are also mitigated by a planning strategy. Our feeling now is that we are not safe until we have the materials in our plant ready to go.
Planning for 2021
With this in mind, I continue to urge everyone to plan well ahead for demand in the coming year. The more that we can understand upcoming demand and ensure that we have the materials on-shore the better. I see that there is going to be huge competition in 2021 for components and those of us that are ahead of the game are going to win.
Finally, though, let’s celebrate the good. Nine months ago I did not foresee that we would be shortening our Xmas holiday in order to cope with the huge demand that all sectors seem to be seeing. Our economy seems to be very buoyant and, although this may be unsustainable, it seems that this is carrying on into the early part of next year.
I would lie to take this opportunity to thank you for your business and support in 2020. I wish everyone a Merry Christmas and a well deserved break, and look forward to catching up for an exciting 2021!!!