Geopolitical Risk & Global Supply Chains
The United States retail industry, worth $7 trillion, relies on a global supply chain network which increases the risk of disruptions due to geopolitical issues. US retailers source materials globally to provide the best products to consumers. Managing these global networks requires a complex risk breakdown structure to account for uncertainties such as geopolitics, tariffs, and climate events. Retailers must continually evolve their supply chain risk structure and will discuss these issues at the RILA LINK Retail Supply Chain Conference. (60 words)
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FAQ - Geopolitical Risk & Global Supply Chains
Frequently Asked Questions
Geopolitical Risk & Global Supply Chains
FAQ 1: What is the impact of geopolitical risk on global supply chains?
Answer: Geopolitical risks can lead to the disruption of global supply chains, which can have potentially dire consequences for the world economy. An increasingly volatile world necessitates that retailers and other businesses continuously build and evolve their supply chain risk structures to mitigate these disruptions.
FAQ 2: Why do retailers need to evolve their supply chain risk structures?
Answer: Retailers, as part of the larger global trade ecosystem, must evolve their supply chain risk structures to adapt to an ever-changing geopolitical climate. This adaptation is crucial to manage the risks associated with war, transport capacity, climate change, protectionism, and more, which can all affect the integrity of supply chains.
FAQ 3: How has the US-China trade war affected global supply chains?
Answer: The US-China trade war has made assessing geopolitical trends and risks an increasingly important risk mitigation strategy for businesses globally. The trade tensions between these two countries have highlighted the need for companies to remain agile and consider potential adjustments to their supply chains to navigate the intricacies of such geopolitical conflicts.
FAQ 4: What are some of the trends shaping the future of global supply chains?
Answer: According to the Conference Board's publication, key drivers likely to shape future global supply chains include transport capacity risks, climate change, geopolitical risks, and concerns about labor markets and protectionism. These factors are reshaping how companies strategize their sourcing, manufacturing, and distribution processes.
FAQ 5: How does global trade readjust in response to geopolitical fragmentation?
Answer: As global trade and supply chains readjust in response to geopolitical fragmentation, they may become tied to blocs of countries, and financial exposures may shift accordingly. This can lead to a realignment of trade partnerships and the creation of new economic blocs based on geopolitical alliances.
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