Inflation has become a small influence in the economy of most countries for years. It is challenging to fathom its impact on the return, especially for supply chain management.

As per the figures of the Bureau of Labor Statistics, the CPI or Consumer Price Index rose 8.5 percent for the last one year, breaking records since the year of 1981.

It can be said that the pressure caused by inflation impacts all aspects of our lives from fast consumer goods to delivery fare.

It is forecasted that the wage of inflation is likely to return due to the outbreak of the pandemic.

So how technology mitigates the impacts of inflation on supply chain management. Let’s figure it out in today’s article.

How Technology Mitigates The Impacts Of Inflation On Supply Chain

The systems of modern logistics are developed to operate at near capacity. As soon as the bottlenecks happen, the troubles could cascade via the systems.

When the pandemic broke out, it did not take so long for distortions whose reason is due to consumer behavior changes in order to snarl conventional supply chains. You might not know this, but ocean-going shipment backlogs have led to retail shortages, causing a sharp increase in commodity prices.

It is believed that modern technology could potentially reduce operating costs while increasing efficiency. This outcome could help businesses to lower the resurgent impact of both inflation and other supply chain problems.

Conventionally, the sector of supply chains is slow to positively benefit from digital transformation (DX) which has been modernizing various industries.

Notoriously are supply chains complicated unlike other business practices which are simply digital, the supply chain involves brick-and-mortar assets like transportation and warehouses. The enhancement of technology can abstract the current obstacles in logistics.

The introduction of QR / RFID tracking on packaging and products provide the complete monitoring of each product as a part of the product data collective set – or product cloud. It is used for tracing or tracking the origin when needed.

Digital Twins

Digital twins, machine learning and AI have reinvented the industry of logistics. By using smart solutions, businesses are monitoring complicated shipment networks in real time.

They can also remove bottlenecks thanks to knowing the time, place, and method to shift products from the rail network to the road or marine to the air.

Digital twins might be the most critical invention to cut costs and help businesses deal with inflation. This technology involves the utilization of various technologies to set up a virtual and sophisticated supply chain simulation.

Some experts contended that digital twins can supersede as another way to maximize the performance of networks. The modeling of twins provides businesses the ability to anticipate any disruption and utilize AI to identify a workaround.

Wrapping Up

Above is all relevant content about how technology mitigates inflation's impact on supply chain management. Hopefully, you can find it helpful for your consideration.

One more thing, to better perform in the supply chain, it is advisable to closely track the trends of the logistics field like the latest technology to apply. Thank you for reading.