The thing about supply chains is, you don’t really notice them when they are working well.
Most of the time supply chains simply purr away in the background, making sure that everything is in exactly the right place at the right time. The final products and goods that customers require are there precisely when they are needed.
This makes it very easy to take supply chains for granted. However, every once in a while, a major disruption comes along which brings home the importance of having resilient supply chains that can keep critical goods available to those who need them.
That disruption could be a pandemic like COVID. It could be a political decision such as Brexit. Or it could even be something as random and unexpected as a ship getting stuck in the Suez Canal.
These disruptions are not simply inconvenient. They can cause lasting damage to businesses, economies and individuals. In some cases they can even cost lives.
Medical Supply Chains
As a manufacturer of components for the UK’s medical and bioscience sectors, ENL knows that nowhere are the stakes higher than when it comes to supply chains for essential medical equipment. We recently wrote about how plastics have been at the heart of the recent COVID response. However, it is worth remembering that beyond COVID there is a wide range of other medical functions that also demand high-quality, sterile plastic containers and devices.
This issue has elbowed its way to the frontpages in recent weeks, with the news that GPs have been advised to stop performing most blood tests as the NHS struggles to cope with an acute shortage of the plastic sample bottles needed to carry out the procedure.
Blood tests are a critical way of tracking the progress of diseases such as cancer or diabetes, and are vital for both initial diagnosis and continuing treatment. The inability to carry out tests at the volume required will undoubtedly impact on people’s health. In the longer term could even cost lives.
As ever, the reasons for supply chain failure are complicated and numerous.
Firstly, clinicians have identified some demand side issues, as procedures delayed due to COVID have come back on line, leading to a spike in the number of blood tests being requested. Quite simply the delayed wave of blood tests booked outstripped the availability of the equipment needed.
Secondly, there are supply side issues. The specialist companies that provide the bulk of the vials to the NHS, like many other companies in the manufacturing sector, have told reporters that they are facing new challenges caused by Brexit and COVID. These are around transportation, port and freight capacity, and issues at the UK border as new trading conditions come into force.
Finally, there is an increasing challenge in sourcing raw materials, something which anyone working in plastic manufacturing will be all too aware of. The sector’s trade association, the British Plastics Federation has recently warned that polymer shortages across Europe were impacting on production. These shortages have been caused by a range of factors, a lack of shipping containers, extreme weather, rising demand, and of course the COVID pandemic.
The pandemic has also led to a spate of what are known as force-majeure declarations, as producers and suppliers of raw materials have struggled to fulfil contracts of particularly LDPE, LLDPE, and HDPE. Force-majeure is a clause in contracts which allows either side to not fulfil its obligations when something beyond the control of both parties occurs. The fact that we are seeing so many declarations of force-majeure is itself an indication of the impact that worldwide challenges are having on the sector.
What Can Firms Do?
Some of the challenges that we see at the moment, for instance around the shortage of vials for blood tests, are likely to be relatively short term. There is a clear market need for vials, and there will be a correction in the market to fulfil this need, – either from existing suppliers, or from new market entrants.
However, the underlying challenge that this shortage highlights is around the need for all producers and manufacturers to continuously assess their own supply chains to make sure that they are resilient and fit for purpose.
Here at ENL Group, as a leading UK plastic injection moulding company, we have invested a lot of time in assessing and testing our own supply chains to make sure that we can continue to deliver the high-quality components that our customers need.
For instance, we have taken steps to ensure that our own supply chains are as short as possible to reduce the risks of disruptions. We have also increased our own storage capacity, allowing us to hold more materials for our customers, helping to safeguard continuity of supply. Not only does that provide reassurance to customers that we will deliver the components that they need, but it also means that we can fix pricing, which many customers have benefitted from as prices have increased.
Additionally, we have previously written about the benefits of ‘re-shoring’, of seeking suppliers closer to home that operate in the same markets as you do. This too can increase resilience, help ensure quality, reduce risk, and assist with cashflow with goods not having to be paid for many months in advance.
The fact is that supply chain issues should not be on the frontpage of newspapers or news websites. If they are it is usually a sign that something is not working.
Here at ENL we do not want supply chains to be making headlines. That is why we will continue to do everything we can to keep effective, efficient, and resilient supply chains firmly in the background, where they belong.
About ENL Group
ENL Group is based in Portsmouth, UK and Veľké Kostoľany, Slovakia. Established in 1958, we have been servicing UK-based and European companies for decades. Working with a secure supply chain, ENL provides quality components for quality-driven customers – with full certification for all of our products and quality checking at every stage.
Operating 24/7, we design, manufacture and deliver critical components for our customers across the UK and Europe.
Contact Us for more information about ENL and how we can help your business.