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Australian small suppliers are spending less on supply chain technology than global counterparts

Supply Chain Technology

Economic concerns, talent shortages and cybersecurity are the top challenges for small suppliers, according to new research from Software Advice, yet Australian supply chains are investing less in technology than their global counterparts.

The organisation – which provides advisory services, research and user reviews on software applications – surveyed 1,100 supply chain management leaders in the US, UK, France, Germany and Australia to learn about the challenges and plans of supply chains.

Respondents were screened to ensure their business had less than USD $500 million in annual revenue and less than 1,500 employees.

Of all respondents, 45 percent said that inflation was their top concern, with 33 percent citing a recession as their biggest worry. Concerns over inflation were the highest in France (50 percent), while US respondents were most worried about a recession (38 percent).

The struggle to attract and retain supply chain-focused employees over the past two years was prominent throughout the study, with 80 percent of global respondents citing this as an issue.

Talent shortages have impacted procurement abilities in the past six months, said 30 percent, with 71 percent of German respondents reporting moderate to significant talent struggles.

As cyber attacks continue to grow worldwide, 41 percent of supply chain management leaders said they had experienced disruptions linked to a cyberattack over the last 12 months.

Over half (55 percent) said advanced cybersecurity was very important to the success of their company, with investment in technology to advance cybersecurity capabilities being the top reported priority for tech spend this year.

Respondents in the US, UK and France said they allocate six percent or more of their company’s budget to supply chain tech spending, but Australia falls behind the pack with over half (51 percent) saying supply chain technology gets five percent or less of the annual spend.

Elsewhere, the top three procurement challenges faced by SME suppliers in the six months to February 2024 included product availability issues (40 percent), delays in procurement (38 percent) and product quality issues (31 percent).

The top recommendations to build a resilient supply chain and protect against the top challenges include joining a group purchasing organisation, enhancing employer branding and reputation, using secure remote access solutions and leveraging predictive analytics.

See the full report and Software Advice’s recommendations here.

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