How supply chain disruptions have impacted Notre Dame’s goods and what they mean for businesses in general // The Observer
Even Notre Dame’s signature Kelly green isn’t immune to the supply chain issues that are interrupting industries across the globe.
As supply chain complications linger into 2022, Hammes Notre Dame bookstore faces a number of ongoing inventory issues, including difficulties sourcing Kelly green clothing to sell online and in-store,” said director of strategic initiatives Gracie Gallagher.
Given that the merchandising industry is rather forward-looking, Gallagher said the Kelly Green shortage hasn’t affected customers yet, but could become common next fall if complications from the supply chain were preventing his team from sourcing enough color.
“When we hear in the fall, ‘There’s no Kelly Green,’ you might not notice it immediately, but you might notice it next year,” Gallagher said. “Is the supply chain going to open up enough that we can hunt some more with Kelly Green? Otherwise, right now [we] don’t necessarily have the amount of Kelly green that we would normally want.
During the last football season, the bookstore also faced challenges in stocking all sizes, adequately staffing the stores and maintaining the same volume as in previous years. Customers may have been surprised not to find their size, or they may have noticed that the bookstore looked a little more sparse than usual, Gallagher said.
While most customers were understanding, Gallagher observed many surprised reactions that Notre Dame – despite its resources and reputation – faced the same supply constraints as any other merchandising company.
“A lot of people know Notre Dame as an amazing place, a place that has really good resources and the ability to give out a lot of financial aid and top-notch products in the bookstore,” Gallagher said. “The fact that supply chain issues impacted a place like Notre Dame was quite surprising and humanizing to people.”
Gallagher said the bookstore was also facing personal technology supply issues. Staff members often had to wait months longer than expected for computer replacements.
Business professors including Katie Wowak, who specializes in operations analysis and supply chains at the Mendoza College of Business, also referenced delays in replacing office equipment and computers.
From a broader perspective, Wowak said recent supply chain issues have caused companies to change the way they think about their operations and sparked new interest in supply chain operations. formerly neglected.
“I think COVID has really exposed how fragile supply chains are and how global they are,” Wowak said.
Before the pandemic, lean supply chains were the name of the game, but pandemic-induced bottlenecks have encouraged companies to reassess the low-cost just-in-time inventory strategy, Wowak said.
“Companies have really tried to operate lean,” Wowak said. “They don’t want to keep a lot of safety stock or excess inventory on hand because it can cost them money.”
Holding safety and excess inventory increases costs for businesses, but the inability to supply products to customers during times of shortage also hurts profits, leading some businesses to build up inventory as insurance against shortages. and bottlenecks.
Many manufacturing companies shut down when the pandemic hit. This included many large factories in China where COVID-19 was first discovered. Companies with lean supply chains quickly burned inventory and were unable to order more raw materials to fix the problem.
At the same time, Wowak said consumer buying habits have changed as people spend more time at home and demand more household and home improvement products such as home fitness equipment. home, baked goods, wood and even toilet paper.
Closures of manufacturing companies created the initial shocks to global supply chains, but a slightly different problem persists today: bottlenecks.
Wowak defines a bottleneck as a step in the procurement process that has the lowest capacity or throughput limiting factor within a supply chain.
” A big part of [bottlenecks] these are the ports,” Wowak said. “If the capacity of one part of the supply chain is limited, it restricts all the flow upstream in the supply chain in order to go down to the consumer.”
Large ports often lack the space and manpower to unload products from cargo ships, Wowak said. This means that inventory sits idle inside freighters, unable to reach consumers who demand it.
Gallagher said port bottlenecks diminished and slowed inventory at Notre Dame Bookstore, especially during the initial stages of the pandemic.
“It started when we couldn’t get our shirts, sweatshirts and shoes off of tankers off the coast at various ports, and that’s just a ripple effect,” Gallagher said.
Later in the pandemic, shortages of some products — including all things Kelly green — added to port issues already weighing on bookstore inventory.
Businesses and economists are still grappling with the question of how long these supply complications will last.
“It’s a million dollar question about how long these things last,” Wowak said. “I think it will last a long time. I don’t see the timelines getting any shorter at all.
Managers see light at the end of the tunnel for Notre-Dame Bookstore and anticipate improved inventory levels ahead of the 2022 football and holiday seasons.
“We’re still seeing some of that impact, but we’re getting more positive reports of the opening of the supply chain towards the end of this year,” Gallagher said. “It should be easier to get your hands on the volume of products and the types of products that people are used to seeing.”
In the short term, companies can try to ease supply issues by hoarding more inventory to buffer supply shocks and demand swings, Wowak said.
Gallagher said Notre Dame Bookstore maintained a buffer of stocked inventory from when people bought fewer goods during the height of the pandemic; however, these supplies were quickly depleted once stores reopened and goods became harder to come by.
In 2021, merchandise and bookstore managers have been forced to face the harsh realities of supply chain limitations.
“It was tough because we could only be so proactive,” Gallagher said. “We had to be flexible in that we got or sold products at different times of the year than we normally would.”
At some point in the middle of the football season – during an exceptionally hot week – the bookstore sold out most of its warmer temperature inventory.
“We didn’t have t-shirts. Our volume of t-shirts was so low that we pulled out our winter gear and then received this massive shipment of t-shirts in November,” Gallagher said.
Many decisions in the last football season have been characterized by trying to make the most of shortages and supply constraints, Gallagher added.
“It was hard to be as committed to solving problems as we all would have liked to be,” she said.
Looking for long-term solutions, Wowak said companies should start exploring plans to add more suppliers, a move that could have prevented the supply shocks that occurred when many international manufacturing hubs are extinguished.
“When you get additional suppliers, you kind of spread your supply chain risk,” she said. “It’s a long-term solution that can help [companies] mitigate supply chain issues in the future.
Wowak thinks there will be a “fundamental shift” in the way companies source inputs, with many likely choosing to buy the same component from multiple suppliers, a strategy called dual or multi-sourcing.
“I think we’re going to see businesses really move away from lean operations and keep more inventory on hand,” Wowak said. “And I think we’re going to see a change in the degree of domestic sourcing.”
With the impactful changes on the horizon and the daily impact of supply chain bottlenecks, Wowak said student interest in supply chains has reached a new high.
Specifically, students became more interested in the introductory process analysis course she teaches, a course she says should really be called “supply chain management.”
“Before COVID, I always had to sell the importance of supply chain management. ‘I promise you it’s a legit thing,’ Wowak would tell his students. ‘And now you have nothing You just say “supply chain” and everyone is like, “Oh my God, yeah, I totally get it.”