Prior to the coronavirus (COVID-19) pandemic, economic development professionals supported local and regional businesses with their business needs stemming from the local economy such as workforce, incentives and regulatory compliance. Largely absent from this list was support for supply chain optimization as many businesses seeking lean operations functioned with international supply chains. These global supply chains proved to be vulnerable during the pandemic due to shutdowns and slowdowns in various parts of the world. Post-pandemic, as local economies start the reopening process, economic development professionals must include or elevate the importance of supply chain optimization as a part of their economic development strategy.
One of the significant impacts of the pandemic are the serious issues in companies’ supply chains, endangering their ability to fulfill orders. The economic shutdown has created disruption in all parts of the supply chain:
For years prior to the pandemic, much of the raw material and component assembly parts of the supply chain was centered in Asia, taking advantage of the lower cost of labor overseas. The pandemic has abruptly shuttered these supply chains. This has resulted in businesses looking to alternative sources either in or near the United States. Businesses, however, may not have all the information they need to understand or address the gaps in their supply chains, which is where economic development professionals can help.
Three steps that economic development professionals can take now to prepare to support businesses with supply chain needs in the months and years to come include:
In the emerging post-pandemic economy, companies will likely make their site location decisions with a heightened emphasis on the reliability of their supply chains, and economic development professionals who understand and can support this need will be well-positioned for success.
Government officials and economic development professionals with questions about this topic are encouraged to reach out to a member of the Baker Tilly Municipal Advisors economic development team.