New Delhi: Led by the aftereffects of the global Covid-19 pandemic, the ongoing transformation of global procurement and supply chain functions will accelerate in 2022 with a rise in the market share of small retailers worldwide and a growing adoption of shared procurement resources, according to BuyHive’s latest whitepaper, titled ‘Top Supply Chain Trends to Watch in 2022’.
For large buying houses, retail chains and downstream manufacturers around the world, BuyHive has enumerated seven key trends to look out for and adapt to. These trends are distilled from BuyHive’s conversations with its global network of suppliers and buyers, including some of the world’s largest buyers and manufacturers in categories like textiles and apparel, consumer electronics, fashion accessories among others.
Minesh Pore, Co-founder and CEO of BuyHive, said, “2022 is going to be another hectic and transformative year for the procurement industry around the world with a marked dominance of small retailers over the global retail landscape. We also foresee indirect sourcing professionals step up and lead the worldwide transition to a hybrid work model.”
BuyHive’s top supply chain trends for 2022 are:
1. Small-sized retailers to grow
The momentous shift of power in the global retail industry in favour of third-party e-commerce platforms or marketplaces will in turn have a major impact on the sourcing and procurement sector. We will see a large number of smaller-sized retailers exerting control over the global retail sector, as compared to a handful of large-sized retailers until now. SME retailers are not only here to stay and grow, but they will also quite likely emerge as the dominant retail model of the future.
2. Shared procurement resources will take over traditional sourcing
The growing dominance of smaller retailers will in turn lead to the balance of global sourcing shifting from traditional, in-house sourcing experts to independent or freelance sourcing experts in 2022, with the latter choosing to work with multiple buyers as shared procurement resources. These experts will apply the gig economy principles to traditional sourcing and in doing so, will enable smaller retailers to compete with large buyers with affordable, high-quality sourcing.
3. Indirect sourcing professionals will lead the global transition to hybrid working
The pandemic has forced nearly all organizations around the world to rethink the future of the workplace, and experiment with hybrid or remote working. As a large proportion of the global workforce moves towards establishing their home offices, indirect procurement professionals will step up to lead and support this transition.
Further, the irrelevance of the full in-office attendance models will lead to a declining demand for office-based technical equipment, office supplies, and catering. On the other hand, demand for home-office resources, including technology assets will increase. Indirect procurement managers will need to develop and implement new procurement policies that enable the workforce to purchase what they need from a new pool of preferred suppliers.
4. Reliance on tech-enabled procurement to grow
Covid-19 related restrictions are expected to continue through a substantial part of 2022, hindering international travel for procurement specialists. It could take a long while before travelling to the source becomes normal again. As a result, Procurement and supply chain professionals will continue to experiment with tech-enabled sourcing in 2022. Enabled by modern tech and communication tools, remote sourcing will become even more mainstream. In many ways, technologies like Augmented or Virtual Reality, Artificial Intelligence and even Blockchain will define the future of global sourcing.
5. Big Procurement Projects will remain on hold
Massive procurement projects will continue to remain on hold in 2022 as businesses adopt a wait-and-watch approach to the pandemic. In addition, many companies are still working on getting back to their pre-Covid operational levels and will remain cautious in committing to multi-million dollar sourcing deals.
6. Effects of shipping disruption to continue to affect global procurement through 2022
The ongoing shipping and logistics crunch disrupting the supply chain and procurement in 2021 will continue to affect the global supply chain through 2022 as well. Further, a recent analysis of latest shipping, port, and manufacturing data has found that the delays will worsen in 2022, before they get better. These unprecedented supply chain disruptions have caused inflation, increase in freight charges, clogged ports amongst others, imploring supply chain professionals to find their ways to work around them for the foreseeable future.
7. Contingency planning is going to be strategic to procurement plans
The discovery of the Omicron variant of the Coronavirus and the recent spate of worldwide disruptions led by it demonstrates once again that post-pandemic recovery and return to normalcy will continue to be a challenge for most large economies around the world through 2022. For businesses large and small, leaders in charge of procurement will be forced to adapt to the disruption risks by keeping effective contingency planning at the front and center of their procurement plans for 2022.
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