Inc.: China’s Economic Woes Are Impacting Small Businesses

September 13, 2023

China’s economic challenges are impacting global supply chains, causing concerns for businesses that rely on it for manufacturing. Factors such as labor shortages, production delays, increased demand, and ongoing lockdowns in China have disrupted supply chains since 2020. This has led to rising prices and longer lead times for many products.

China faces economic challenges, including higher wages for factory workers, a trade war with the U.S., and record-high youth unemployment. President Biden has referred to China as a “ticking time bomb.”

Businesses are advised to:

  1. Understand the issues at play, including rising labor costs, labor shortages, and the trade war’s impact on sourcing from China.
  2. Consider diversifying their manufacturing and sourcing from countries like India, Vietnam, and Mexico, though diversification can introduce complexities and potential quality concerns.
  3. Focus on customer satisfaction and delivering products despite supply chain challenges. Some businesses are adjusting their cash flow strategies and working closely with customers to plan for supply chain disruptions.
  4. If necessary, raise prices but offer higher-quality products to maintain customer loyalty.
  5. Start planning for supply chain diversification and building relationships with alternative suppliers to mitigate risks.

The evolving situation in China requires businesses to adapt and find creative solutions to maintain their supply chains and customer satisfaction.

 

For further insights on China’s economic woes are impacting small businesses and recommendations from Seraph’s founder and CEO Ambrose Conroy, you can refer to the Inc. piece following the link below. 

 

About Seraph 

A global enterprise consulting firm that partners with business leaders to handle their most complex problems in areas such as supply chain, operations, and manufacturing challenges while delivering long-term operational and leadership improvements. Seraph has extensive on-site industry experience in the automotive, private equity, defense, medical device, electronics, energy infrastructure, and engineering sectors. The Seraph leadership team brings vast expertise across; crisis management, mergers, acquisitions, due diligence, restructuring, turn-around services, product launches, and logistics. Our four-phase process has been proven to provide quick payback and positive ROI, which is measured throughout customer engagement. Learn more at www.seraph.com and follow Seraph on LinkedIn.

Related Articles

Winning starts at the on-site assessment!

Winning starts at the on-site assessment!

The value of applying to the Seraph Operational Excellence Awards begins before winning a trophy; it starts with the on-site assessment! Our objective is to equip your company with tools for the rapid identification of both areas of excellence and potential...