By Neil Butters, Head of Procurement at PfH 

Since the coronavirus outbreak, PfH have undergone a period of due diligence and have been actively engaging with our bank of strategic suppliers to gain greater understanding regarding the potential exposure to global supply chain risk.

It is evident that Chinese New Year has mitigated the impact so far, as suppliers who source from China typically plan ahead and increase stock in the run up to CNY.  At present, the spread of Covid-19 has not materially impacted supply across a wider geography, but clearly the situation is live.

From engaging with our supplier base, the general feedback is that they are confident exposure to tier one supply chain risk is minimal and being mitigated. Analysis of tiers 2 and beyond have proven difficult and needs further exploration with conversations ongoing. However, the positive being that some factories are open, up and running with a regular flow of staff.

With PfH having one of the most extensive supply chains within the sector, we do not underestimate the need for ongoing analysis and research with national merchants and local merchants alike in order to mitigate risk.

If necessary, PfH account cards can be used across the wider PfH materials merchant supply chain in order to maintain product availability whilst retaining spend control and visibility and we will continue to support Members where required in identifying product, manufacturer and merchant alternatives should we start to see scarcity across particular product lines.

As mentioned, PfH will continue to engage with our supply chain and monitor the situation closely to ensure that Members experience minimum disruption.

Statements from the PfH supply chain:

Travis Perkins

“We have a sophisticated sourcing strategy and strong supplier relationships in place. This allows us to anticipate and manage most risks, and so although the scale of this uncertainty remains difficult to predict, we believe we will be able to maintain our supply of products with limited disruption. It is, however, important to emphasise that the full impact of the extended shutdown will not be apparent until the workforce is able to return to work and therefore, we will remain vigilant and flexible to manage what will be a dynamic situation.”

Wolseley

“We continue to closely follow the Coronavirus outbreak in China and any interruptions to supply chains and transportation that may result. The Lunar New Year holiday has also been extended by the Chinese Government and could be extended further if the virus cannot be contained. Wolseley UK and our supply partners already hold significant stocks which are increased as standard around Chinese New Year.  At present we do not expect major supply issues unless the situation continues for a prolonged period.”

City Electrical Factors

“CEF have access to thousands of suppliers [currently circa 19,000] and can be agile if there are problems with a particular country or product. We source products from a broad range of suppliers as a business strategy to ensure we are not over reliant on any one supplier or country. In addition, CEF carry large levels of stock and consciously invested in additional stock pre-Brexit and to cover the Chinese New Year period which will help mitigate and reduce any supply chain issues that may arise.”

Saint-Gobain

“We have ceased all but absolute essential travel to China. Our branch network and operations structure work collaboratively to ensure customers are served and our supply chain is robust to withstand any impact. We have, over the last 18 months done a considerable amount of work in relation to risk assessing and analysis to understand the risks associated with supply chain vulnerabilities and are confident that in the unlikely event of any UK impact we would be able to continue to serve customers.”