UAA Experts Weigh In on Supply Chain IssuesDec 6, 2021
The holiday shopping season is in full gear, but supply issues continue to complicate fulfillment of shoppers’ wish lists. UAA Professor Darren Prokop is an expert in supply chain management, and has been featured in several recent articles on the topic.
In the Anchorage Daily News, Prokop commented on the short-term benefits of a suggested new shipping route called the Anchorage Pacific Air-to-Sea Service that could boost the amount of cargo moving through the airport.
Earlier in the season, the Anchorage Daily News reported on widespread shortages and higher prices in Alaska caused by disruptions in the global supply chain. “This is supply chain inflation,” Prokop said in the article. “The worry down the line is what if we have general inflation. We’re not there yet, but when too much money is chasing too few goods, that’s where price inflation happens.”
Ralph Townsend, UAA professor of economics, also contributed to this discussion, noting that there are cascading problems impacting the supply of many products that are in demand.
What are the factors leading to breakage in the system? Both Townsend and Prokop described the challenges in an hour-long “Talk of Alaska” segment.
“Long multi-country linkages are fragile and prone to strain and fraying when demand pressure builds,” said Prokop. COVID-19 has impacted the linkage in many ways. “With the surge in demand coupled with shortage of capacity and bottlenecks, we are seeing prices go up, delays…and ripple effects along the supply chain.”
“The supply chain is making decisions months ahead of time,” Townsend said. “That assumes that manufacturers and shippers know what people want.” The pandemic has changed what people wanted in ways that the supply chain can’t predict, he said.
When there’s too much stuff in one place and not enough in another, there are bottlenecks, Prokop said in an interview with KTOO that focused on winter gear shortages. He said the problems won’t be resolved “until uncertainty over things like potential lockdowns or worker shortages quiets down.”
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