79% of Irish Companies Facing Supply Chain Disruptions

Irish companies are facing significant supply challenges this busy retail season, according to findings from reichelt elektronik, a leading European multi-channel retailer. Conducted by independent research firm OnePoll, the study surveyed industrial companies across Ireland, revealing that supply chain congestion is leading to production delays and financial losses, with companies having difficulty securing essential components. However, there are signs of cautious optimism, as companies implement strategies to address bottlenecks and strengthen supply chain resilience.

Supply chain problems remain widespread – though hope remains for improvement

As we enter the festive period, problems in the supply chain are widespread among Irish companies. This year, around four out of five companies (79%) reported major or moderate disruptions due to supply chain bottlenecks, with one third (34%) having to stop production for at least 20 days over the course of this year due to missing components, resulting in huge production and financial losses for the companies affected. However, respondents are tentatively optimistic that the situation will improve over the next twelve months (55%).

International crises, economic uncertainty and what Ireland can do

The largest supply chain obstacles faced by Irish companies are the rising cost of components (70%), soaring energy costs (75%), economic uncertainty both worldwide (67%), and in Ireland (65%). Geopolitical tensions are also causing supply chain destablilisation, with the war in Ukraine (67%) and the looming threat of conflict in the Middle East (57%) cited as particularly negative influences, closely followed by the potential fallout of a trade conflict between China and the EU (55%). All of these factors are contributing to an increasingly complex business environment.

Irish companies want to see expanded global trade agreements, better access to emerging markets, and more strategic policies to boost supply chain performance. A look inwards shows that 61% per cent agree that the current government provides a solid foundation for international trade. However, to boost success, they primarily seek more free trade agreements with non-EU countries (37%). Additionally, 33% would like easier access to new trade partnerships in regions like Africa or Southeast Asia, and the same percentage calls for more incentive programs or laws to enhance global competitiveness and reduce costs. Meanwhile, 32% believe less internal conflict within the government would be beneficial.

More diverse, more regional, more secure – how the supply chain should become

To better safeguard against material shortages, most industrial companies in Ireland are adopting both long-term and short-term strategies. Currently, 45% of companies have increased their stock levels, with an additional 41% planning to do so by 2025. Many firms are also implementing long-term strategies to regionalise and diversify their supply chains. Approximately one-third (33%) have already switched to regional suppliers to reduce reliance on international providers, while 47% aim to pursue this approach in the next year. Similarly, 41% of companies have expanded their supplier networks, with another 39% intending to do so soon.

Many Irish companies are taking decisive action to secure their supply chains against emerging threats, cyber-security risks and physical attacks. One in three companies (38%) have implemented measures this year to enhance the security of their supply chains, while an additional 40% plan to take similar steps in the coming year. The impact of the Supply Chain Duty of Care Act is also apparent, with 38% of surveyed companies changing suppliers this year to comply with the legislation, and another 34% intending to do so within the next 12 months.

“Even though supply chain bottlenecks have received less attention this year in the face of equally important challenges, such as high energy costs, this does not mean that the supply chain situation has eased,” summarises Christian Reinwald, Head of Product Management and Marketing at reichelt elektronik. “Irish companies still need to find clever ways to ensure efficiency, quality and cost control in their production. The fact that companies are choosing short and long-term solutions for this is a good sign.”

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