How Confident are you managing risk when it comes to your business?
We have partnered with data scientists at Sciens, to explore the current risks/ranking locally and globally impacting the supply chain of Australian industries and businesses.
Supply chain risk analysis should contain:
- A clear outline of direct and indirect suppliers, services, and customers
- Supply chain mapping in its entirety
- Systems and system management
- Data modelling of current and future industry potential impacts
- B2B insights from suppliers and customers
This information should be derived from:
- Internal data resources relating to import/export
- External local and global industry data insights
As an import heavy country, many Australian businesses have had to reduce their offering due to the import limitations of raw materials and services, hence the reliance on an accurate analysis of supply chain risk to assist in decision making moving forward.
Obtaining reliable industry data can be costly, time consuming and limiting, so we have developed a series highlighting current industry related information with this blog focus on those within and reliant on the construction industry.
The Australian Construction Industry
There are currently over 3 million construction businesses registered in Australia with a high concentration listed in both Victoria and NSW. From a supply chain management perspective, these businesses are highly reliant on other industries as a source of raw material and/or services and industries are highly reliant on them.
Industry Statistics
Table 1: Top 5 Suppliers to the Construction Industry by Ranking
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(Source, Sciens, February 2021)
Construction is reliant on these industries both locally and globally, with China being the largest supplier to the Australian industries depicted in the figure above, closely followed by Japan.
Table 2: Top 5 Countries Supplying Construction Directly & Indirectly
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(Source, Sciens, February 2021)
If there are supplier disruptions this will then cause a flow on effect to consumers reliant on the construction industry and so forth. Below are the current top five supply chain dependent on the construction industry:
Table 3: Supply Chain Dependencies for Construction by Ranking
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(Source, Sciens, February 2021)
Taking into consideration the risk factors and reliance on other industries, the modelling has delved deeper into the construction category to the industry groups who are ranked the most at risk.
Table 4: Top 5 at Risk Groups within Construction
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(Source, Sciens, February 2021)
Overall Risk Ranking for Construction
The data below reveals how dynamic the construction supply chain risk score has been throughout 2020, and it demonstrates the need for regular data monitoring and modelling to reduce risk.
Table 5: Industry Risk Score
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(Source, Sciens, February 2021)
Consideration of the import/export risk of the entire supply chain for each industry, it was determined that Construction was ranked 3rd in terms of supply chain risk at present.
Table 6: Supply Chain Risk Ranking
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(Source, Sciens, February 2021)
Questions you should be asking yourself and your business around Supply Chain Risk Management
- What is your actual risk, and who supplies your business and who do you supply?
- Has your business considered internal and external data analysis inclusive of related industry risk factors?
- Have you been incorporating the right data modelling showing the full picture for more informative decision making?
- Are your data sources reliable to feel confident your business is managing risk effectively and identifying potential disrupters before they occur?
