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Swiss companies face severe supply chain bottlenecks

Goods are being delayed in container ports in many parts of the world. Keystone / Neil Hall

Four out of five firms surveyed by the Swiss Business Federation (economiesuisse) have complained of problems in getting hold of raw materials and essential parts for their goods.

The cost of the worsening supply chain conditions is starting to be passed on to consumers. Some companies are looking into putting staff on shortened hours with economiesuisse warning that the situation could have negative consequences for the economy as a whole.

In its survey, economiesuisse received feedback from 237 companies and industry groups. The vast majority (80%) said that port logjams and closures in many parts of the world are creating a headache for their businesses.

In addition to cancelling some orders, and therefore missing out on sales, around half of the firms surveyed said they have already passed on increased costs of deliveries to consumers. In the next six months, more firms said they may have to follow suit.

“Industry representatives surveyed expect a price increase of around 5% within the next six months,” stated economiesuisseExternal link on Monday. “Even if part of the price pressure can be absorbed by margins, the problems with stagnant logistics chains and missing components will increasingly be felt by consumers.”

Shortages are most keenly felt for wood, steel, aluminium, semiconductors, plastics and chemicals. Supply chain issues have spread from Asia and are now prevalent in Europe.

Added to the problems is a sharp rise in energy costs as the price of gas and oil has exploded in recent months. This has increased the risk of inflation, economiesuisse warns.

“This is a dangerous development and could significantly dampen the economic outlook for this year and next,” Switzerland’s largest business lobby group said. “The affected industries do not expect delivery problems to end until the next year.”

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