Survey: political uncertainty is dampening expansion plans by U.S. companies

Political uncertainty is cramping the international expansion plans of U.S. companies, who are worried about how those changing conditions may affect their supply chains, a new survey shows.

The issue touches a vast portion of the market, since 82 percent of U.S. companies say they would like to expand into new markets, including 36 percent that are eyeing expansion opportunities in the BRICS (Brazil, Russia, India, China, and South Africa) and MINT (Mexico, Indonesia, Nigeria, and Turkey) countries, according to the survey released today by connected planning specialist Vuealta.

Despite that enthusiasm, 55 percent of the U.S. business decision makers surveyed said political uncertainty and its impact on their supply chains is a key factor holding them back from moving in to new markets, according to the report, "The Future of the Supply Chain: Managing the impact of climate change, political uncertainty and digitization."

As companies grow globally, there is inherently more risk as they manage more complex, global supply chains, London-based Vuealta said. Unfortunately, the majority of the U.S. survey respondents indicated that they felt fairly unprepared to address unexpected challenges, and almost one-fifth of respondents (18 percent) stated that their customer base was likely to feel the impact of a supply chain failure in less than one day. In reaction, over half (57 percent) of U.S. companies are currently looking to re-shore a significant portion of their supply chain operations to the United States, the survey found.

"Our research found that U.S. companies would like to expand into new markets, yet they're concerned about seeing critical supply chains and logistics disrupted by events outside of their control and 47 percent don't have the ability to rapidly model the impact of a potential failure on their supply chain," Vuealta CEO Ian Stone said in a release.

The findings also demonstrate that those surveyed don't believe that their business leadership understands how different factors could dramatically impact their supply chain. Respondents said they did not believe their leadership understood the potential impacts of political and market uncertainty (47 percent), cyber-attack (51 percent), or natural disaster (49 percent).

"The good news is that this uncertainty can be addressed by businesses managing what they can control in real-time and planning for all eventualities," Stone said. "This level of preparation is achieved with a transparent, connected supply chain ecosystem which encourages collaboration between partners."

The survey was conducted in June 2019 by Censuswide on behalf of Vuealta. Respondents included more than 1,000 business decision makers that have a supply chain across the U.S. and U.K. (with over 500 respondents based in the U.S.).

Do you understand the potential impact of disruption on your #supplychain? Our latest research found many UK business leaders don't, whether disruption is caused by cyber-attack (42%), market uncertainty (47%) or natural disaster (43%). Find out more here: https://t.co/nV1lllIi7h

— Vuealta (@vuealta) June 26, 2019