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With a semiconductor shortage ongoing and the United States getting most of the semiconductors it uses from overseas markets, lawmakers earlier this year introduced the CHIPS Act. The CHIPS Act aims to free up approximately $52 billion in federal funding to spur more domestic production of the chips that are used in just about every consumer technology imaginable.

But with both houses of Congress still struggling to reconcile their respective iterations of the proposed bill, two leading semiconductor manufacturers say they'll have to table their ramped-up production plans until Capitol Hill hammers out a solution.

One of those companies is Intel, which in January, announced its intentions to build two semiconductor factories near Columbus, Ohio. The expectation was to begin construction in July, but as The Washington Post reported, the project will be suspended indefinitely because of insufficient funding, citing comments from the company's spokesperson.

"As we said in our January announcement, the scope and pace of our expansion in Ohio will depend heavily on funding from the CHIPS Act," said William Moss, spokesperson for Intel, in an email to the newspaper. "Unfortunately, CHIPS Act funding has moved more slowly than we expected and we still don't know when it will get done. It is time for Congress to act so we can move forward at the speed and scale we have long envisioned for Ohio and our other projects."

Legislative quarreling is placing a hold on semiconductor plant construction.Legislative quarreling is placing a hold on semiconductor plant construction.

Another semiconductor company that has tied its factory development plans to the CHIPS Act's implementation is GlobalFoundries, a rival semiconductor manufacturer based in Malta, New York. In a statement obtained by Construction Dive, the company stated that while the project is poised to begin on schedule, the actual timetable will largely be influenced by government investment, among other considerations.

What is the hold-up?
What the Senate and House of Representatives appear to be at loggerheads over are some of the bill's earmarks and provisions. For example, as Reuters reported, the Senate's version of the CHIPS Act includes an additional $200 billion for scientific and technological innovation to better compete with China, the world's leading producer. The House's version of the CHIPS Act is close to 3,000 pages in length and has several trade proposals that the Senate's doesn't mention.

Other leading chip manufacturers, however, aren't letting the lawmakers on Capitol Hill influence their building plans. As the Austin Business Journal reported, Samsung recently chose Yates Construction to head up construction for the company's $17 billion chip production plant near Austin, Texas. Texas Instruments, meanwhile, just broke ground on a $30 billion facility in Sherman, which is in Northeast Texas, as reported by Construction Dive. Both chip developers are confident that their respective projects should help bolster the semiconductor supply chain, as demand continues to far outpace supply. In 2021 alone, over 1.1 trillion semiconductors were sold globally, according to the Semiconductor Industry Association.

We all want to make the world a greener place. Unfortunately, in supply chain matters, we have to deal with some of the planet's biggest polluters by the definition of our jobs. Container ships are necessary to keep the modern world functioning, but, according to NPR  they provide 3% of the world's total carbon emissions. While having no net emissions is a long way off yet, it's not too late to start considering making adjustments in your own supply chain.

So what are the benefits?
Outside of the obvious benefit of reducing emissions to help slow rampant climate change, there are some very clear benefits for moving your organization to green supply chain practices. A study done of best in class logistics providers by the Government of Canada found that the positives of a greener supply chain can be felt company wide. By switching to greener practices, companies found better distribution efficiency, lowered costs, and greater customer retention once they had switched to a more sustainable model.

Sustainability also has corporate social responsibility (CSR) implications as well. By being more sustainable, your organization can claim that you are taking a serious attempt at mitigating environmental damage and win a big public relations coup. Companies that follow through with a strong policy of CSR have more positive outcomes in very important areas. Companies with a perception of caring about their role as a social actor have better brand perception, an easier time hiring and retaining employees, and attracting investors. With the rise of environmental, social and governance (ESG) investing strategies, sustainability makes your company far more enticing. 

How you can achieve a more sustainable supply chain
Some of the changes you can make to start with your sustainability efforts are quite simple. The first thing you should be looking at is how to reduce the amount of fuel consumption by creating efficiencies. One way to make your supply chain more efficient is to consider building a circular supply chain, where trucks don't deadhead on return destinations. It's possible you could be using empty trucks for returning goods or other materials back to their starting point, or use them for deliveries of finished products on the way back. On a similar note —reducing the amount of fuel used by your vehicles can create significant cost savings and reduce fuel consumption. According to the British Assessment Board, overhauling your large goods vehicles with aerodynamic packages can reduce overall fuel consumption by around 10%, helping you realize significant savings in fuel costs and net benefits for your emissions.

In summation, supply chain management will always have an impact on the environment at large. As supply chain professionals, trying to find ways to mitigate environmental damage is critical for the profession going forward. Whether it be by looking internally, or switching manufacturers to ones that are more sustainable —  going green will only help your organization in the long term.


We've all heard about supply chain shortages impacting every facet of our lives from a lack of electronics to the prices of cooking oil and food going up. Now, supply chain shortages could be impacting U.S. power companies, forcing them to take far longer to fix major outages. Being in a season of extreme heat that's only going to get worse as summer drags on, it may be time to look at alternative methods of cooling ourselves down in case the AC goes out.

Why is this happening?
Supply chain issues are disrupting U.S. power companies in a twofold manner. To start, critical parts are beginning to run out for many U.S. energy organizations – potentially hampering their ability to complete both routine maintenance and emergency repairs after natural disasters such as hurricanes, heat waves or earthquakes. As a chief executive at AEP stated, "We're doing a lot more splicing, putting cable together, instead of laying new cable because we're trying to maintain our new cable for inventory when we need it." Transformers are running in short supply as well, critical for getting power to homes, transformers are also some of the more vulnerable components of an electric grid to being affected by natural disaster. Part of this issue is that transformers are in low supply, with lead times of up to a year for parts. This could partially be due to the fact that semiconductors are necessary in the construction and effectiveness of electrical transformers, a product that has been in short supply due to the pandemic and growing demand

Another issue power companies are facing is the lack of raw materials to actually generate the power. Due to recent record increases in demand, as well as shortages of natural gas, as well as coal – companies are struggling to find enough of a stockpile to reliably operate their grids. This, combined with droughts causing issues with hydroelectric generation could spell some worries for the U.S. power grid in the coming months, leading up to the winter.

So what can be done?
For electrical equipment, and raw generation materials shortage, very little can be done in the short term — but there are long term supply chain solutions. The U.S. Department of Energy's Office of Energy Efficiency and Renewable Energy recently released deep-dive assessments into power generation supply chains and came up with a few long-term solutions. One that was highlighted is the promotion of building American clean energy components and processing, something that has traditionally been offshored. By doing so, companies can shorten their supply chains and ensure that they both don't run out of critical fuels as well as have a nearby, reliable source of parts.

The solutions to the supply chain crisis in energy may not come quickly – but changes will need to happen in the face of our changing climate as well as the now demonstrated risk to critical infrastructure posed by current supply chain operations. For now, let's just hope our AC keeps working through the hot summer months.

Semiconductors are one of the most important components of almost all the electronic devices we use today, and are in high demand from corporations globally. With the rise of the internet of things, and our general reliance on more and more complicated technologies, the value and necessity of semiconductor manufacturing on a large scale will only become more important. Currently the world is in the midst of a major shortage that isn't expected to lift for a long period of time, but how did we get here and what have the effects been?

How we got here
As with the majority of today's supply chain issues, it started with the COVID-19 pandemic. When mixed with the spike in demand for electronic devices that has occurred over the past few years and shows little sign of slowing, semiconductors are in short supply. While manufacturing companies are attempting to increase their production output, building new facilities takes time as the product is very specialized and difficult to create. Even the largest companies in the world are swamped by demand. Taiwan's Semiconductor Manufacturing Company, the world's largest manufacturer, has little extra capacity to create more, and other producers are sold out of product completely.

What does this mean?
Virtually every industry has felt the effects of the semiconductor shortage. According to Fortune, the global auto industry lost $210 billion in revenue in 2021 alone, and the rising prices of semiconductor chips have been passed on to the end consumer by increasing the price of new automobiles. So far, in 2022 alone, the chip scarcity has prevented the manufacture of 2 million new cars, putting a dent in the total supply. While the shortage is affecting most manufacturers of electronics, the broadband and medical device industries being the hardest hit along with auto manufacturing, according to Bloomberg

For other organizations which rely on these chips, depleted supply has left little room for error in supply chain management. The average inventory of semiconductors for an American company that relies on them was 40 days. But by 2021, that fell precipitously to only five days. According to a report by the United States Department of Commerce, this lack of inventory means that any disruption of major semiconductor manufacturing plants, such as a natural disaster, has the potential to damage manufacturing capacity in the US.

Do we need to worry?
While new facilities are being created to help alleviate this swing in supply and demand, some worry it might not be fast enough. The CEO of Intel attributed weakened second quarter results to lowered quantities of the semiconductors required for key manufacturing operations, bottlenecking the company. He was quoted in an interview with CNBC as saying "That's part of the reason that we believe the overall semiconductor shortage will now drift into 2024, from our earlier estimates in 2023, just because the shortages have now hit equipment and some of those factory ramps will be more challenged." With the increase in manufacturing capacity ramping up, bank on the shortage to end in the next few years, but also expect a little more tightening of the belt for a while longer.

The world is a difficult place to be as a supply chain expert today and will only get more difficult in the future. We're living in a time of near unprecedented uncertainty in the modern era and the risk it brings to supply chain management is immense. To manage the potential chaos, you must be proactive and prepared to shift your strategies on a dime. From natural disasters and wars, to trade disputes and unreliable suppliers, you must be ready for everything.

How to create a strong risk management strategy.

Train your team in risk awareness and build organizational habits around it

Risk management is built from the ground up. When you're trying to make plans around what could go wrong in your organization, you need to build a framework that allows individual employees to not only spot potential risks, but to report them with no fear or reprisal. Regular training programs on risks for your company and fast-response drills are integral to being ready when something goes wrong. These processes should be well known at all levels of your organization and practiced regularly. Another important lesson to learn, as underlined by McKinsey, is that employees should not worry about coming to their managers or executives with problems or mistakes they've made. A culture of blame, shooting the messenger and heavy punishment means that potential risks or mistakes in a company will remain hidden out of fear.

One acronym could save you a lot of headaches

While a common acronym in the supply chain world, it's always best to keep prevention, preparedness, response, and recovery (PPRR) front of mind when you think about developing your risk management strategy. In order to make your plan fully effective, you should be doing the following for each step.

Prevention

An ounce of prevention is worth a pound of cure. Building the aforementioned organizational habits of risk management is just the start. Your organization should also be building a comprehensive risk management plan in order to properly identify and mitigate risks before they happen. You should also be conducting regular reviews of both your internal processes as well as of the readiness of your suppliers to deal with risk and unforeseen events.

Preparedness

This is the simplest step, the best way to prepare is to develop a list of your known risks and create strategies and tools to react quickly.

Response

You must be ready to respond immediately in the face of a supply chain crisis or employee mistake as the effects of inaction can compound the problem. Having a rapid response team trained in common situations and defined before a problem can arise will help mitigate the effects of the issue.

Recovery

In order to ensure your business can continue as normal, your organization should develop strategies in order to recover in case of a supply chain emergency. From having backup sources for crucial materials to having a public relations plan in place in case of shortages, having a clear idea of what to do in the most dire circumstances is critical to bouncing back after a setback.

Implementation of ERP systems is a complicated process that requires a high degree of attention to detail. While snags in the process of implementation are something to be expected, action must be taken immediately to ensure that it doesn't negatively impact your business. A major food distributor recently revealed that they had lost $20 million in revenue during a transition of ERP systems that also raised their operating expenses by $7.6 million. This isn't an uncommon phenomenon either. A McKinsey report shows that two-thirds of all ERP transformation projects have a negative ROI and three-quarters of them fail to stay on budget and end up taking far longer than expected.

To help you through the ERP implementation process, we've collected three of the best tips to help you avoid potential pitfalls.

3 Success Tips for ERP Implementation

1. You have to know your data well

One of the most important things you can do before your implementation is make sure you have a consistent, single source version of the truth through data. Without  such consistency feeding your system, your ERP will not work nearly as well as you want it to, and cause major issues with both your suppliers and your internal systems. In projects as big as ERP implementation, it's recommended to perform a thorough review of your data and sources, as well as carry out a full data cleanse to ensure optimal effectiveness.

 2. Negotiate a longer period of more intensive support

ERPs are tricky, whether you're bringing in a new one or transforming your current solution, issues are bound to come up months after implementation. To help combat this, ensuring you have a greater window of intensive support is critical to ensuring your organization adopts the platform correctly. According to a study done on a major Canadian oil and gas company, three months is a great amount of time to make sure you can get the support you need for real problems that could affect your business.

 3. Communication is king

This is a success factor in almost any area of a business. You need to communicate to your employees at every level what the change is going to be, and how it will benefit them. The ways you can communicate with them are varied, but it is essential you get buy-in from your workers. There are a few ways you can accomplish this, one of them being to get demos that show the benefits of the project started very early in your implementation process. It's important that employees are fully aware of the potential benefits to them early on to help smooth out the complicated change-management processes that accompanies such a large project. With proper communication between all levels of your company, many of the pitfalls that have the potential to crush your ERP ROI can be avoided before complications arise.

Self-driving cars are all the rage in popular culture – and their widespread adoption, even in a limited form, seems just years away. With that in mind, many technology leaders have been pushing boundaries of what is possible in terms of autonomous driving, and are proposing self-driving trucks as a way to alleviate projected supply chain issues, and drive efficiencies. Could autonomous trucks be the real future of shipping and hauling?

The benefits
From an American perspective, the trucking industry is facing a major shortfall of drivers that is projected to get even worse. The American Trucking Associations (ATA) has stated that the U.S. is short around 80,000 drivers as of today, with projections of being short 160,000 by 2030 This is no insignificant shortage, and a situation that having an autonomous truck could alleviate. Even a semi-autonomous vehicle could take some of the pressure and strain off of truck drivers, helping them complete their routes faster.

If we imagine a world in which the technology for these trucks is here today, the benefits and speed that they'd convey to the supply chain is significant. Efficiency is one of the most talked about positives for a self-driving truck. As discussed in a Fortune article, long-haul trips would be simplified, as regulations on driving time affect humans to a maximum of eight hours of work, self-driving trucks would be able to stay on the road for 17 hours. The implications are clear – the longer trucks are on the road, the more goods they can deliver. Patrick Penfield, professor of supply chain practice at Syracuse University stated about self-driving efficiency that "Freight will arrive at a destination faster. A human truck driver usually takes five days to go from New York to Los Angeles. It'll take an AT (autonomous truck) 48 hours."

The issues
There are unfortunately some problems with relying on autonomous trucks for solving shipping and hauling issues, especially in the near term. The technology just isn't there yet, and factors like weather can throw off current builds. This issue, and other navigation snags, isn't likely to be fully solved by the time the trucking industry hits its severe shortfall.

Something else to consider is the potential unrest that many companies may experience due to wide-scale economic anxieties from shipping workers who may feel pushed out of their jobs. It's estimated that in the U.S. alone, there are 3.5 million truck drivers, many of whom could staunchly oppose any measures taken by fleet owners and companies to move to automated solutions.

Are autonomous trucks the answer to supply chain woes?

It remains to be seen if self-driving trucks will revolutionize the shipping industry in the near future, but many are confident the change to autonomous shipping is inevitable as a slow process. To quote Andrew Culhane, the CSO of Torc Robotics in an interview with FleetOwner.com, "... this technology isn't a question of if, but when."

From a growing reliance on nearshoring to obtaining more materials from suppliers that are located within the States, retailers have an all of the above mentality to overcoming all the supply chain issues that are kneecapping their operations. But import activity continues apace, and recently hit a record high as managers race to get ahead of seemingly unending inflation.

In March, the most recent month in which data is available, the nation's major shipping ports received approximately 2.34 million twenty-foot equivalent unit (TEU) containers, according to a newly released Global Port Tracker report from Hackett Associates and the National Retail Federation. That sets an all-time record in the number of import arrivals, topping the 2.33 million mark set 10 months earlier. It was also a substantial uptick on a month-over-month and year-over-year basis, up nearly 11% and 3.2%, respectively.

Jonathan Gold, vice president of supply chain and customs policy for the NRF, said consumer buying activity is the root cause of the growth in imports, but inflation seems to be having an influence as well.

"Retailers are importing record amounts of merchandise to meet consumer demand, but they also have an incentive to stock up before inflation can drive costs higher, Gold explained. "Whether it's freight costs or the wholesale cost of merchandise, money retailers save is money that can be used to hold down prices for their customers during a time of inflation."

While supply chain disruptions continues to frustrate consumers and business owners, inflation has summarily replaced it as their biggest economic pain point. Indeed, as a recent poll by Gallup of everyday Americans found, 17% point to the high cost of living as the nation's single biggest problem, up from 10% who said as much in February. Small-business owners share that belief, with 32% of respondents citing inflation as the country's biggest challenge in a National Federation of Independent Business survey.

Imports reached an unprecedented level in March.Imports reached an unprecedented level in March.

NRF says it's time to tame tariffs
The Federal Reserve has raised key interest rates in an attempt to get a handle on inflation by cooling demand. But this can take some time to bear fruit. A quicker remedy, according to the NRF, is by rolling back tariffs. Gold noted that despite what tariff supporters may claim, countries don't pay for tariffs — meaning those doing the importing — consumers and business owners do. Citing a report from Moody's, Gold also said that since tariffs were imposed in 2018 major trading partners like China have wound up paying only 7.6% of tariffs. Americans have wound up paying for the remaining 93%.

Since neither inflation nor tariffs are expected to abate any time soon, import volume at the nation's shipping ports is poised to remain robust. In June, for example, an additional 2.29 million TEUs are anticipated, which would be an increase of 6.6% from 12 month earlier, according to the Global Port Tracker report. The ensuing months for imports are also likely to outpace their monthly counterparts from 2021, rising 5.3% in July, nearly 1% in August and 0.3% in September.

The manufacturing sector and the organizations that represent it have encountered a host of setbacks and challenges as 2021 nears its midpoint, much of it linked to the supply chain. But April was a solid month, and companies' output outpaced what economists had forecast for the 30-day period, according to a new report from the Federal Reserve.

Manufacturing production in the U.S. rose in April nearly 1% on a monthly basis and by more than 6% compared to 12 months earlier, the Fed announced. This surpassed what economists polled by Reuters had predicted. Indeed, producers' actual output was two times higher than what they had anticipated, forecasting an uptick of 0.4% from March.

The increase in total industrial production makes it four straight reports in which the number was higher than 0.8%.

As has been the case for professionals in virtually all product-based industries, outside of inflation, the supply chain has been manufacturer's biggest issue from an operational and logistical perspective. Indeed, in the National Association of Manufacturers' quarterly survey, more than 88% of respondents cited the supply chain as their central pain point to better productivity and profitability, more so than the cost of raw materials or a lack of qualified talent.

But in April, the first full month of spring, productivity was in full bloom, among manufacturers of all sizes, industries and specialties. Indeed, the Fed report showed that production accelerated by nearly 4% for automakers during April. Similarly, manufacturers that work in durable goods also had more to sell and deliver. The only exceptions were producers in electrical equipment, furniture and related products and appliances and components.

Manufacturers were able to produce more than economists anticipated in April.Manufacturers were able to produce more than economists anticipated in April.

Manufacturers still struggle to fill open positions
Despite the encouraging uptick in activity, production could very well have been even more robust were it not for manufacturers' struggles with hiring and retention. Timothy Fiore, chairperson for the Institute for Supply Management, spoke to this point in this ISM's latest Report on Business.

"The U.S. manufacturing sector remains in a demand-driven, supply chain-constrained environment," Fiore said. "In April, progress slowed in solving labor shortage problems at all tiers of the supply chain. Panelists reported higher rates of quits compared to previous months, with fewer panelists reporting improvement in meeting head-count targets."

Helping to offset the labor shortage in April was better capacity. As Reuters cited from the Federal Reserve's data, overall capacity utilization for producers rose to 79.2%, which is up 0.6% from March. This markets the highest capacity utilization rate for manufacturers in over a decade.

The National Manufacturers Association is working in concert with The Manufacturing Institute to help producers reach their hiring goals through the Creators Wanted campaign. Launched earlier this year, the Creators Wanted initiative spearheaded by the Manufacturing Institute and NAM seeks to recruit 600,000 new workers by 2025, increase student enrollments in technical and vocational programs by 25% and improve the perception of the industry among parents as a whole.

With Inflation raging, many products and services cost double what they did at this time last year. These ever rising costs have business owners feeling doubtful conditions will improve with any real significance in the months ahead, according to a new poll from the National Federation of Independent Business.

For the second month in a row, the NFIB's Small Business Optimism Index held at a reading of approximately 93, marking the fourth consecutive instance that it's been well below the historical average of 98.

Fueling business owners' discontent was inflation. Indeed, nearly one-third of respondents in the survey cited this as their biggest business problem, more so than the supply chain or the lack of qualified job applicants for open roles.

Bill Dunkelberg, chief economist at NFIB, noted that inflation affects every aspect of how an organization operates in terms of what decisions are made and when.

"Small-business owners are struggling to deal with inflation pressures," Dunkelberg explained. "The labor supply is not responding strongly to small businesses' high wage offers and the impact of inflation has significantly disrupted business operations."

Most business owners have raised their prices due to rising costs of their own.Most business owners have raised their prices due to rising costs of their own.

CPI rose again in April
Many of these wages have been offset by inflation. The government tracks the degree to which prices rise or fall through the Consumer Price Index, which has trended higher fairly consistently for well over a year. In April, the all items index segment of the CPI rose 8.3% on a year-over-year basis, according to the Department of Labor. Not including the cost of food and energy, the measure rose 6.2% from 12 months ago. According to the NFIB poll, the vast majority of respondents — 70% — have raised their average selling prices. Just 4% said they're pricing their products and services for less than what they do normally. 

Inflation isn't the only issue that's weakened small-business owners' overall outlook. As previously noted, over 90% of respondents said supply chain disruptions had adversely affected their operations — 36% significantly so, according to the NFIB survey.

Much like inflation, a confluence of factors have contributed to the supply chain problems that are keeping businesses from reaching their goals, one of which has to do with excessive container volume at the nation's largest shipping ports. But some of those problems could be smoothed out — or, potentially, become even more tumultuous — depending on the outcome of contract negotiations between the International Longshore and Warehouse Union with the Pacific Maritime Association. With the contract poised to expire on July 1, the PMA and ILWU are aiming to hammer out an agreement as soon as possible.

The two sides are at odds over several issues, chief among them being what role automation will play moving forward at these port locations. While the Pacific Maritime Association is in favor of implementing more of this technology to reduce operational costs and quicken the supply chain, the ILWU is staunchly against the further leveraging of automation, believing it will cost them their jobs.

Formula has become increasingly hard to track down for parents needing to feed their newborn babies and toddlers, the shortages fueled by a perfect storm of supply chain snags and production slowdowns. But the federal government has announced a series of actions designed to shore up volume while producers aim to overcome the obstacles that have hamstrung their operations.

On May 13, the Biden administration launched a website in conjunction with the Department of Health and Human Services. The online destination — HHS.gov/Formula — is designed to provide parents with real-time updates on where they can go to locate baby formula, contact information for formula manufacturers, access to community resources as well as general guidance from primary care providers as well as the American Academy of Pediatrics.

Additionally, as the White House said in a press release on May 12, the Biden administration is also in ongoing communication with retailers and formula developers to identify what strategies can get more formula from warehouses out on to store shelves more quickly and efficiently.

Why is formula difficult to find?
A confluence of worst-case scenarios have led to the formula supply crunch. One of which has to do with China and its recent COVID-19 mitigation measures. In a move designed to slow the spread of the virus — a so-called "zero-COVID" policy — officials have reimposed lockdowns on both business owners as well as the general population. This has crippled economic activity, in a nation that has the second largest economy by gross domestic product It also has a 49% share of the infant formula market, according to estimates from Statista.

Supply chains problems are now affecting babies.Supply chains problems are now affecting babies.

But the main cause of the shortage is what's happened domestically. As has been widely reported, in February, the Food and Drug Administration launched an investigation into a Michigan-based formula manufacturing plant in the aftermath of several babies who were sickened after consuming some of the plant's powdered formula. With the investigation still underway, the plant has remained offline ever since. The owner of the plant, Abbott, produced more than 40% of nation's formula in 2021, according to The Wall Street Journal. And while the U.S. does import some of its formula — much of it from China — approximately 95% of it is made within the country.

The resurgence of COVID in China, combined with the FDA-led investigation in Michigan, has created a perfect storm of conditions that has rippled throughout the supply chain and impacted virtually all of the United States.

In the meantime, the Biden administration announced other plans aimed at helping families find formula more easily. These include loosening the regulatory hurdles manufacturers have to clear to get product to the stores, cracking down on unfair market practices and price gouging and importing more infant formula, especially from trade partners like Chile, Mexico, Ireland as well as the Netherlands.

"The Biden-Harris Administration will continue to monitor the situation and identify other ways it can support the safe and rapid increase in the production and distribution of baby formula," the White House said.

In just about every product-driven industry, too many dollars are chasing after too few goods. From microchips to crude oil to food staples that are typically well stocked — like wheat, corn and eggs — the items you need to complete your manufacturing processes remain difficult to come by. This puts the suppliers that provide you with these necessities in a bit of a predicament — especially when they have other customers who are looking for the same hard-to-find raw materials that you are.

An approach that can help you more effectively manage this issue is to strengthen the relationships you have with your suppliers. This way, they may be more inclined to prioritize the neeof your supply chain over their other customers', just as soon as the relevant parts, foodstuffs and materials become available. 

1. Invest in strengthening their capacity
The amount of goods a supplier can procure is largely dependent on its capacity limitations — how much the business can obtain or produce at any one time. You may be in a position to help by investing in your suppliers' operations so they have the financial resources to enhance output. This is something tools and hardware manufacturer Stanley Black & Decker has done with its supplier. As Don Allan, the company president and chief financial officer, noted during an earnings call this past February, Stanley Black & Decker co-invested in some vendor projects that will boost capacity for rare earth metals like lithium, which are used for the making of batteries in power tools. Lithium is also need to develop the ion batteries that energize electric vehicles.

Long-term agreements can do a great deal of good to strengthening the relationship you have with key suppliers.Long-term agreements can do a great deal of good to strengthen the relationship you have with key suppliers.

2. Seek a long-term deal
How long have you and your supplier worked together? If all of your contractual agreements have been for a brief period — like a few months — you may want to consider inking a more long-term agreement that is for a year or longer. Long-term agreements help to strengthen the relationship you have with your suppliers by letting them know you're committed to their business. This can incentivize a supplier to attend to your production needs above others who are once-in-a-while clientele or who haven't shown the same level of commitment that you have, backed up by your financial investment.

3. Be open to feedback
Is it possible that some of your production processes are causing you to waste raw materials or use more than is necessary to deliver the same product? Your suppliers may be able to offer some suggestions, but only if they know you're willing to accept their guidance and won't consider their it a slight or somehow undermining your expertise. Making your suppliers aware that you're open to their recommendations on how to minimize waste can make life easier for everyone.

4. Be respectful of their financial commitments
Paying invoices on time — every time — shows your suppliers that you're sensitive to the needs of their business and their ability to run a tight ship. When you're consistently punctual about payment, they're more likely to return the favor by going above and beyond to get the goods that are essential for your profit-making processes.