Last month, World Trade Center (WTC) San Diego convened its quarterly gathering of the Global Competitiveness Council (GCC), an advisory group consisting of senior executives from many of San Diego’s most globally facing brands. This quarter, the discussion focused on the extraordinary, global disruption we have seen in the supply chain and logistics space amid COVID-19 and other factors.
The GCC welcomed the following industry experts to share their insights:
- Eduardo Acosta, vice president, R.L. Jones Customhouse Brokers
- David Adler, head of procurement and manufacturing, Cubic Corporation
- David Arida, senior vice president, Dexcom
- Leslie Oliver, director, global supply chain, Solar Turbines
- Hyoduk Shin, Ph.D., professor of innovation and operations, UC San Diego Rady School of Management (moderator)
Trade wars and a pandemic constrained the movement of goods in the past few years, while changing consumer behavior, characterized by a record-breaking uptick in online sales, further strained the supply chain system. As a result, ports and businesses across the country have experienced ongoing shortages of labor, containers, truck chassis, and more, while ocean-going vessels have been forced to wait in harbors, in some cases for more than two weeks. This global traffic jam has impacted schedule reliability and forced companies to revisit the ways in which they manage risk.
A few takeaways from the session:
- The pandemic has highlighted the strategic importance of supply chain in most organizations.
- With schedule reliability down across the supply chain, many companies have moved from a just-in-time strategy to just-in-case, meaning firms keep a little extra in reserve, whether that be raw materials, final product, or anything in between.
- Some mid-market players have been boxed out of getting raw materials and critical supplies by much larger multinational enterprises. This has forced those mid-sized players to source from a network of smaller suppliers to get what they need.
- Some companies have supported their smaller partners in the supply chain by investing capital into them. This has de-risked the supply chain by offering stability to weaker links in the chain.
While companies will have at least a few more challenging months ahead, there is a light at the end of the tunnel and things may not look so bleak for the San Diego region in the years ahead. E-commerce is a long-term game and one that San Diego is well-positioned for. Cali Baja is already vertically integrated in Manufacturing, and a warehousing boom in Otay Mesa is increasing capacity for e-commerce goods coming via land and sea. The passage of USMCA, uncertainty from tariff trade wars, and recent reshoring/nearshoring trends have made this mega-region an ideal location for companies that want to move operations closer to home but maintain a binational advantage. By continuing to invest in trade infrastructure, such as our ports of entry and global connectivity, San Diego and the Cali Baja Binational Mega-Region can further cement itself as a hub for innovative firms and people.
We’ll continue these conversations with key partners across San Diego and Tijuana on July 29—check back here soon for details and registration.
Interested in growing your business internationally?
World Trade Center San Diego, home of the Export Specialty Small Business Development Center (SBDC) works directly with companies – free of charge – to help them expand internationally and grow in San Diego. Whether your small company is interested in learning about exporting and international growth, or your small or medium sized company is ready to export and grow internationally, World Trade Center San Diego is here to help.