How do geopolitical events, such as trade wars or sanctions, impact your supply chain? How do you mitigate risks associated with political instability in key supplier regions? Saving Changes...
Such events can primarily create cost overruns or schedule delays. They can also (secondary impact) create quality concerns if alternate sourcing yields poorer quality products.
Responding to these risks can be done in a few different ways including:
- Alternate sourcing of similar materials or alternate materials
- Contingency reserves and schedule buffers
- Pre-purchasing and building up inventory well ahead of when the materials are needed
- Locking in pricing and adding terms and conditions to contracts to protect the buyer from material cost increases
Kiron
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1 reply by Aung Sint
Mar 30, 2025 11:04 AM
Aung Sint
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I couldn't agree more, Kiron, especially with the current global trade wars happening now!
Senior Projects Manager | Field & Marten AssociatesNew Westminster, British Columbia, Canada
Aung, trade wars and tariffs, such as the ones we’re currently experiencing, can significantly increase the cost of goods traded between countries, create trade barriers, and disrupt the smooth flow of products. These disruptions force companies to adjust to new regulatory requirements, which can squeeze profit margins, cause delays, and even compel businesses to seek out new suppliers or explore alternative markets.
One effective strategy is diversifying suppliers and manufacturing locations across multiple countries, reducing reliance on any single market. This approach helps minimize the impact of tariffs or trade restrictions in specific regions. Another viable option is local sourcing, which can further mitigate risks and enhance supply chain resilience.
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1 reply by Aung Sint
Mar 30, 2025 11:10 AM
Aung Sint
...
You make some excellent points, Rami! At times, local alternatives may not effectively meet the requirements, making it difficult for the project manager to manage them properly. It's essential to include supply chain resilience as part of the risk mitigation strategies. There’s no doubt about that.
Such events can primarily create cost overruns or schedule delays. They can also (secondary impact) create quality concerns if alternate sourcing yields poorer quality products.
Responding to these risks can be done in a few different ways including:
- Alternate sourcing of similar materials or alternate materials
- Contingency reserves and schedule buffers
- Pre-purchasing and building up inventory well ahead of when the materials are needed
- Locking in pricing and adding terms and conditions to contracts to protect the buyer from material cost increases
Kiron
I couldn't agree more, Kiron, especially with the current global trade wars happening now! Saving Changes...
Aung, trade wars and tariffs, such as the ones we’re currently experiencing, can significantly increase the cost of goods traded between countries, create trade barriers, and disrupt the smooth flow of products. These disruptions force companies to adjust to new regulatory requirements, which can squeeze profit margins, cause delays, and even compel businesses to seek out new suppliers or explore alternative markets.
One effective strategy is diversifying suppliers and manufacturing locations across multiple countries, reducing reliance on any single market. This approach helps minimize the impact of tariffs or trade restrictions in specific regions. Another viable option is local sourcing, which can further mitigate risks and enhance supply chain resilience.
You make some excellent points, Rami! At times, local alternatives may not effectively meet the requirements, making it difficult for the project manager to manage them properly. It's essential to include supply chain resilience as part of the risk mitigation strategies. There’s no doubt about that. Saving Changes...
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