The Supply Chain: A 2022 Recap and Tips for 2023
Supply chain disruptions and delays have impacted businesses in the IT sector for the last several years, and it looks like those issues will continue into 2023. Here are some tips for navigating these challenges so you can get the tech you need.
2022 hasn’t been an easy year for anyone. While there have been a lot of different challenges with a multitude of root causes to navigate, the supply chain continues to be a big source of frustration for businesses and individuals alike. In 2022 alone 38.8% of small businesses in the U.S. experienced supply chain delays due to the COVID-19 pandemic, causing disruptions that led to significant financial losses.
The last few years have seen a number of issues that impacted the global supply chain. Where port crowding was once the exception, it’s now become the norm, meaning that even when goods can be produced and delivered stateside, they may still face delays that keep them from arriving at their ultimate destination in a timely manner. These ongoing issues were compounded by the war in Ukraine, which has impacted the global supply chain since February, and the continuing pandemic. The COVID-related lockdowns in China in particular further disrupted the supply chain and slowed the return to normalcy.
Unsurprisingly, all of these issues have had a major impact on technology upgrades and the IT sector as a whole. Whether dealing with chip shortages or delays on deliveries, it’s been hard to access a lot of the new technology many organizations want and need. Although we don’t know when everything will return to normal — or even what that normal may look like when it does arrive — we do have some tips to help IT leaders head into 2023 with the best foot forward.
Tips For Tackling the Supply Chain Shortage in 2023
1.Don’t Wait, Buy Now
It can be tempting to put off purchases of items affected by supply chain disruptions. After all, if you can put off upgrades until the supply chain issues are resolved, you’ll start seeing lower prices and faster shipping times, right?
Unfortunately, that’s one of the worst things you can do for your organization in the long term. Not only is there no guarantee that prices will go down once the issues are resolved, but if you wait, you’ll be at the back of a long waiting list when products do become available. That means you could be stuck paying the same high prices — or even higher! — and waiting for a shipment. It’s the worst of both worlds!
On the other hand, if you order in advance, you’ll have everything you need ready to go when the time comes. You’ll still have to wait for shipping, but this way, there’s no last-minute panic as you scramble to procure devices, equipment, and other essential products.
If you do decide to buy now, you will need to do some extra thinking about what you purchase given that delivery will likely be delayed. That’s why our next tip is to:
2. Plan Ahead By Keeping End Of Life And End Of Service In Mind
You should always plan ahead when it comes to technology upgrades. However, thanks to the current supply chain problems, you’ll need to plan even further ahead in 2023 and keep products’ EOL and EOS in mind before making any investments. After all, you’ll likely face lengthy delays any time you make a purchase, so you’ll want to include some buffer time in your timelines and be wary of how delays will affect the end of life of your devices or products — both for your existing products and for your new purchases.
To put this into context, picture an example: imagine you didn’t plan far enough in advance given current supply chain delays and you ordered your new products too late. That can lead to several possible issues. Your current products might reach their EOL before your replacements arrive, or you may be stuck midway through a new project or upgrade waiting for a delayed shipment to arrive. When your delayed item does eventually arrive, it may only have a shelf life of a couple of weeks left, meaning you’ll have to begin the ordering process all over again.
To avoid this, try to think about your hardware needs six to twelve months in advance to increase the likelihood of your shipment arriving in time. And keep those EOL dates in mind with any new purchases you make to ensure that you still have a long time before the EOL whenever it arrives.
3. Manage Your Budget Carefully
Supply chain disruptions lead to unpredictable (i.e., higher!) prices. That means you need to stay on top of your budget more than ever to ensure you can get the products you need without breaking the bank.
The fact is, sourcing electronic components is difficult and expensive at the best of times, and component costs are only increasing. In 2022, chip prices grew by 11.7% on average, and current forecasts predict that the chip shortage will continue into 2023, which means the cost of everything from tablets to webcams will remain high. It’s the same story for countless other items. Between June 2021 and June 2022, host computers and servers surged in price by 21%. All of those price hikes mean that if you don’t pay close attention to your budget, you may find yourself stretching it quite thin or even running out of money when you need it the most.
A good way to build some wiggle room into your budget is by raising your top-of-range estimates beforehand since you’ll likely have to pay more for the same items than you did in the past. That way you’re prepared if the prices are higher than what you expected. Even if your prices do remain the same, having some extra space in your budget will help you afford the high costs of expedited shipping.
4. Consider Using Managed Services
As-a-service offerings are becoming increasingly popular. If you think about your daily life, you probably already use a few as-a-service solutions. If you’ve ever used Uber or Netflix, you’ve taken advantage of as-a-service offerings — and just like as-a-service can offer you flexibility and simplify your personal life, managed IT services can also benefit your organization.
Given how things are shaping up for the global supply chain in 2023, being able to offload some of your IT challenges to your managed services provider can prove invaluable. Using a managed services provider means shifting from CapEx to OpEx, meaning you can have more consistent technology expenses instead of scrambling to create space in the budget every time a product reaches its end of life. Plus, managed services will take some of the burden off your IT teams, leaving them free to focus on more pressing matters while your managed services partner ensures your network and security infrastructure run optimally.
Plus, if you want to reduce the headache caused by the current supply chain issues, you can work product refreshes into your agreement with your managed services provider, meaning you won’t have to handle upgrades on your own. Instead, your provider can help replace products when they reach EOS or EOL as part of your regular contract.
Navigate Supply Chain Challenges With TTI’s Help
The supply chain has been undeniably tricky to navigate these last few years. Between the pandemic, the shipping container shortages, the lack of workers, and the war in Ukraine, delays and high prices are all too common. Things are starting to change for the better, but we won’t return to normal immediately.
No matter what 2023 brings in terms of the supply chain, Turn-key Technologies, Inc. (TTI) is ready to help you tackle it head on. Whether you need cabling, servers, or switches, we have you covered. TTI is a trustworthy managed services partner with over 30 years of experience building powerful networks that last. Not only can we fill IT skill gaps, but we can also keep your network up to date with routine upgrades.
Contact us today to get started!
By Craig Badrick