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Beyond COVID-19: Supply chain of tomorrow

Three key actions for 10 supply chain and third-party challenges

Better prepare your supply chain for future shocks

The spread of COVID-19, has been and is still being felt globally across operations in ways that are difficult to model and assess. Without a doubt, supply chains in every country, including Vietnam and across industries are affected.

Compared to other regional peers, Vietnam has done well to contain the pandemic and reopen the economy. Now that the country has moved from crisis response to recovery, the critical question for Vietnamese businesses is how to better prepare your supply chain for future shocks.

Supply chain of tomorrow no longer centers around efficiency and cost management but rather on building a secure and resilient supply chain. This is aligned with the sentiment among global leaders, who plan to make more holistic changes to their respective supply chain strategy, according to PwC's COVID-19 CFO Pulse Survey in May.

It’s time to acknowledge that the world has changed and embrace the “new normal”. Have you focused your attention on areas that matter?

As a result of COVID-19, in which of the following areas are you planning changes to your supply chain strategy? Please select the three most pressing areas.

Develop additional, alternate sourcing options
%
Understand financial and operational health of suppliers
%
Change contractual terms (e.g., to provide your company added flexibility and downside protection)
%
Use automation to improve the speed and accuracy of decision-making
%
Extend tools to better understand customer demand (e.g., changes in desired mix of offerings, triggers to place orders)
%
Extend visibility into your suppliers’ networks (e.g., risk alerts, what-if scenario planning)
%
Improve risk-protection measures (e.g., disaster insurance coverage, more flexible force majeure contract clauses)
%
Diversify product assembly and/or service delivery locations (e.g., to comply with regulations, shorten delivery lead time)
%
Source: PwC COVID-19 CFO Pulse Survey, 4 May 2020
Base: 867

What to look at now

Recalibrate your supply chain and wider third-party matters as you move beyond COVID-19

 

 

Increased needs for greater supply chain visibility through all tiers of the supply chain

Ensure that capacity is appropriately balanced throughout the network

Mitigate potential risks of third party behaviours especially when stock is running low and demand is high.

Planning for possible labour shortage due to unavailability of business critical individuals on-site.

Distressed suppliers can increase pressure or outages on your supply chain ecosystem.

Increased exposure to cyber attacks due to accelerated use of remote access technology

There is no COVID-19 defence for regulatory compliance breaches.

Reduce value leakage and maximise impact of cost reduction initiatives with thorough contract assessment

Ensure mechanisms to increase likelihood of getting a fair and equitable result on future potential claims

Consider wider tax implications when making sourcing decisions

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*ESG: Environmental, social and governance and regulatory compliance

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Get in touch

Dinh Thi Quynh Van

General Director/Partner, Tax and Legal Services, PwC Vietnam

Tel: +84 24 3946 2246

Nguyen Thanh Trung

Partner, Tax Services Leader, PwC Vietnam

Tel: +84 28 3823 0796

Mai Viet Hung Tran

Partner, Assurance Services Leader, PwC Vietnam

Tel: +84 28 3823 0796

Johnathan Ooi Siew Loke

Partner, Deals Services Leader, PwC Vietnam

Tel: +84 28 3823 0796

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