It was May 17, 2020, not yet a year ago but still a few months.
I had made a video called “surviving the inflationary shock” which is coming and which is inevitable.
Over time, we become more aware of the analysis. I wanted to explain to you what was very predictable, namely, that the crisis was going to last, and that during the period, the social distancing measures would have a lasting effect on productivity and therefore production.
This would have a double impact on, not only the availability of the products, but also their price. Logic. When there is not something for everyone, the adjustment of supply to demand is done by price, and when prices go up, it creates inflation.
Here we are.
Factories all over the world are closing because of the shortage of electronic components, you have no doubt heard about it, and the subject of shortages will intensify in the coming weeks and occupy more and more space in the next few weeks. media.
Between teleworking, the problems of managing logistics flows, and social distancing, it is global and global productivity that is collapsing.
There is no longer enough global production capacity because we are not producing under normal operating conditions.
This problem does not only affect electronic components.
It is now spreading to all sectors of the economy.
In the construction industry, ruptures are more and more common.
The equipment is lacking because the factories are not running at full speed, because full speed is not compatible with social distancing, with sick people, with quarantine as soon as you have a patient or two.
It was largely predictable, and I had foreseen it in this video that I invite you to see or re-see in order to put it all into perspective.
While large movements are generally predictable, time limits are much more complex to master.
What will happen now?
We will enter a phase of chronic and random shortages.
Chronic as long as the health crisis lasts, and after covid-19, we have the gaggle of variants that threaten us and the vaccination which could well prove to be disappointing and not represent the marker of the end of the crisis that we all hoped for .
Random, because it’s hard to tell you in advance where these shortages are going to hit, because the economy is big, but, I can give you some clues. This will primarily concern real-time productions. The more an industry is in a tight flow, the more it will be impacted. This is obviously the case with the automobile, or for example windows made to order as well as kitchens for example! So expect to have a hard time getting some things that meet these criteria. Another aggravating element. The distance. The further it is, the more complicated and expensive it will be. This will also apply to industries that need people and manpower, because the virus affects people, the fewer people there are in the manufacturing process the less shortages you will have.
On the food side, mainly local, supply chains should hold. They held during the first confinement while we were in the midst of a health disaster without a mask and without protective equipment. There is no reason for our food supply to collapse, but it can experience difficulties at its base, namely at the agricultural level. If there are no electronic components to repair the tractors, it is not with the current number of farmers that we will be able to cultivate the fields.
It is in this disturbing context that the State is organizing its first emergency meeting on the subject …
A subject that was anticipated in the attic of the eco from May 17, 2020 … I say that, I say nothing, but I do not think less about the goats that lead us.
In this article from France Bleue, we learn that “the representatives of the automotive industry and the electronics industry will be received by the State services this Wednesday February 10 for a first meeting devoted to the shortage of electronic chips which disrupts production. cars in the factories of manufacturers all over the world ”.
As always, it will be wishful thinking, and government powerlessness, “far too little and far too late”.
Do not expect anything from the state except to increase your taxes.
For your activity, for your activities, take the lead.
Store what you need or will need. I am thinking here of all entrepreneurs and businesses. Store everything you can (with intelligence, and staying tuned to your cash flow and risk levels), as prices will go up and some products will be more difficult to find or with longer lead times.
Having stock will not only allow you to keep working and running, but also to take markets, not to mention that it can help you improve some margins.
The first step is to list the items already in tension, and see what is critical and what is not.
To put it another way, don’t wait for the State for your continuity plan. If you are a business leader, large or small, it is on the shortages to come that you have to work on and mobilize your resources because this is the next immediate risk that our economy in general will face.
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It is already too late, but all is not lost. Prepare yourselves !