The State of the Global Supply Chain: Key Statistics and Trends

The recent upheavals in global supply chains have highlighted the importance of understanding this complex, interconnected system that keeps the world economy flowing. This article dives deep into the latest data and trends shaping supply chain strategy across critical areas like logistics, inventory, risk management, and emerging technologies.

Overview of the Supply Chain Market

The supply chain market consists of all the companies and activities involved in producing, shipping, and delivering products and services to end consumers. This includes manufacturers, warehouses, transportation providers, retailers and more.

As of 2022, the global supply chain management market size was valued at $15.85 billion according to DataBridge. The market is forecast to grow at an impressive CAGR of 11.2% from 2020-2027, reaching over $41 billion by 2032 according to Allied Market Research. This rapid growth will be fueled by factors like increasing consumer demand, technological improvements, and supply chain services adoption.

Supply chain market projected for steep growth (Image credit: Unsplash)

COVID-19 Impact on Supply Chains

The COVID-19 pandemic massively disrupted global supply chains according to a McKinsey survey of supply chain executives. A full 75% reported moderate to significant continuing disruptions as recently as September 2022. Among US small businesses, 38.8% experienced pandemic-related shipment delays according to a Granular survey.

However, the impacts varied across sectors: just 32% of retailers worldwide reported major effects in an ABI Research study, thanks in part to ecommerce channels. In response to COVID turmoil, 56% of companies renegotiated contracts and 28% sought alternative sources to cope with shortages based on DataBridge research.

Remarkably, despite enduring disruptions, the supply chain market is proving resilient. Growth is projected to remain substantial in the years ahead as investments pour in to reinforce vulnerabilities exposed by recent shock events.

Supply Chain Visibility

End-to-end visibility remains a persistent challenge for many supply chain organizations:

• 69% of companies lack comprehensive visibility across their whole supply chain according to enVista
• Just 6% claim to have achieved full, real-time visibility across their supply networks
• Vital visibility KPIs include daily performance tracking (40%), cost reduction monitoring (35%), and production service rates (29%) per Enterprise Innovation

This pervasive lack of visibility contributed to an estimated $1.14 trillion worth of retail out-of-stocks in 2020 according to Dataholz. Enhancing transparency and coordination across far-flung distribution networks is vital for supply chain resilience.

Many companies struggle to achieve end-to-end visibility (Image credit: via Data Floq)

Top Supply Chain Disruptors

Supply chains face constant stressors threatening business continuity. Top disruptors include:

• IT outages: The #1 supply chain disruptor, impacting 68% of organizations according to Peerless Research Group
• Severe weather: 62% of supply chain operations affected by storms, floods, heatwaves and other extreme weather according to Thomson Reuters Foundation
• Cyber attacks: A rapidly growing menace, with 50% of supply chains experiencing cybersecurity breaches based on Fortinet research
• Talent attrition: 51% of businesses reporting disruptions due to high turnover and loss of supply chain personnel according to Gartner

Building flexibility and redundancy across sourcing, transportation modes, inventory strategies, and locations can mitigate these risks. Top mitigation approaches include:

• Dual-sourcing key raw materials (53% adoption)
• Expanding reserves of critical inventory (47% adopting)
• Regionalizing supply chain infrastructure (38% converting)

Global Shipping and Transportation Trends

International shipping and freight transportation accounts for over 12% of total global economic activity. Key developments in this logistically vital sector include:

• 74% of supply chains leverage 5 or more transportation modes: trucks, rail, air, parcel, and ocean shipping according to Statista
• The global transportation management systems (TMS) market is projected to reach $4.8 billion in annual spending by 2025 per TMR analysis, up from $3.9 billion in 2022
• Yet only 35% of shipping firms currently utilize TMS solutions indicating major growth potential
• 53% of supply chain operators are mitigating transport risks by dual-sourcing key raw materials and components according to 100 Logistics

Strong growth trajectory for transportation management systems (Image credit: Logistics Viewpoints)

To tame volatility, shippers are advocating improved multimodal coordination, predictive analytics use, and dynamic rerouting applications to strengthen on-time delivery and meet customer expectations.

Inventory Management Hurdles

Antiquated inventory management ripples through supply chains causing major revenue aftershocks. Concerning statistics include:

• 43% of small retailers do not actively track inventory levels according to Tyndale Momentum
• Retail supply chain inventory accuracy hovers around just 63% nationally per RSR
• Out-of-stocks result in 34% more late shipments and penalty costs according to Dataholz

While 24% of independent retailers use QuickBooks for inventory management, large chains and online sellers often struggle with demand forecasting, stockout risks from supply-demand mismatches, and inventory glut from canceled orders. Advanced predictive data tools offer complex operators advantages in anticipating trends and optimizing stock flow.

Supply Chain Technology Innovation

Innovation in data analytics, sensors, system integration, and control tower visibility are transforming supply chain capabilities:

• 41% of supply chain professionals see improved data analytics tools among the most important innovations according to Gartner
• 39% identified adoption of IoT sensors and cloud-based control towers as critical for supply chains per IDG
• Total global spending on supply chain management software hit $15.8 billion in 2022, up 11% year-over-year according to Gartner

From enabling proactive replenishment to multimodal shipment tracking, these solutions aim to increase end-to-end visibility, coordinate ever more complex supply webs, simulate disruptions, and enable artificial intelligence to unlock logistics efficiency gains.

Investing in Supply Chain Resilience

Learning from recent disruptions, companies are strategically investing in supply chains to improve resilience:

Top strategic supply chain investment priorities over past year (Image credit: McKinsey)

By identifying stress points across fulfillment, production planning, inventory, and procurement, the supply chain sector continues upgrading technologies to meet fluctuating global conditions.

Supply Chain Analytics Driving Efficiency

Data analytics is pivotal for unlocking supply chain efficiencies amidst transportation constraints and consumer shifts. Key applications include:

• Factory predictive maintenance: AI algorithms shutting down equipment 30-50% faster when failure looms, saving ~8 hours of downtime per incident worth ~$700K annually per machine per McKinsey
• Automated reorder points: Statistical analytics tailor item restock thresholds company-wide, reducing inventory carrying costs by up to 20%
• Driver fatigue detection: Analytics identify 70% of fatigued drivers via swerving, blink rate and yawn analysis, enabling proactive safety interventions

As analytics capacities grow more advanced, companies aim to enhance supplier relationships, tailor shipping modes, refine inventory mixes, and optimize routes enterprise-wide.

Sustainability Becoming Paramount

Supply chain sustainability is growing as an investment priority and competitive differentiator. Compelling data points include:

• 73% of industry professionals report rising C-suite focus on eco-friendly supply chains according to Gartner
• 63% say their company formally ties executive compensation to sustainability KPIs
• Top green supply chain tactics include supplier audits (61% adoption), product carbon footprint labeling (58%), and warehouse energy efficiency monitoring (55%)

While promising, much work remains to curb logistics emissions as supply chains currently account for 30% of all human-created greenhouse gases.

Managing Supply Chain Risks

Leading external risk factors for supply chain volatility (10 point scale) (Image credit: Statista)

Proactively assessing both day-to-day operational risks and these external economic influences allows companies to assemble mitigation plans including expanding supplier diversity, currency hedging instruments, and safety stock buffers. Ongoing stress testing helps gauge readiness.

Retail’s Race Toward Omnichannel

Omnichannel fulfillment has become an imperative for major retailers. But many still scramble to achieve delivery consistency amidst surging ecommerce volumes.

• Only 15% of retailers can profitably fulfill orders from any channel identically per IHL Group
• 47% report moderate omnichannel readiness while 23% remain unprepared
• Top challenges include in-store pick and pack capabilities (21%), bridging channel data divides (19%), and providing consistent customer experiences (14%)

Legacy infrastructure limitations lead retailers falling behind consumer omnichannel expectations chasing market share losses. Leaders rethinking workflows, inventory planning, and data integration through a digital-first lens appear best positioned moving forward.

Conclusion

This data-rich analysis of the state of global supply chains provides operational intelligence across domains like inventory, logistics, and risk management while spotlighting technology and sustainability trends. Assessing key pressure points and benchmarks provides supply chain executives essential insights to craft strategies aligned with shifting priorities. Recent shock events have thrust supply chains into the spotlight, emphasizing the need for resilience. By learning critical lessons, strategically adopting innovations, and proactively preparing, supply chain leaders can transform persistent vulnerabilities into competitive differentiators.