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Global Supply Chains – Networks of Tomorrow

Macroeconomic conditions and the pandemic have had a massive impact on the stability of supply chains. For Germany as an export nation, high inflation and currency fluctuations also pose a high risk.

German corporates are addressing this challenge by restructuring their supply chains – the following strategies can be identified:

  • Corporates are responding to supply chain problems and disruptions with increased levels of inventory held.
    Just-in-case models are increasingly replacing the common just-in-time structure.
  • Quality and reliability remain key factors in evaluating suppliers leading to a reduction of supply chain partners.
  • Euro and USD are still the top currencies for invoicing.
  • Sustainability is increasingly becoming an important factor for supply chain evaluation: more and more corporates require their suppliers to prove sustainability compliance as part of the onboarding and see sustainability as a real competitive advantage.

Germany is one of the leading countries in integrating sustainability criteria into global supply chains and sustainability is increasingly becoming a competitive advantage. With our global network, we will continue to support you in building more resilient and sustainable supply chains and in achieving premium pricing opportunities.

Hermann Purr | Head of Global Trade and Receivables Finance, Germany , HSBC

Shifting supply chain strategies

The factors influencing supply chains in the last year

Inventory management

92%

are holding excess stock due to the logistical challenges

Supplier relationships

64%

are planning to reduce their supplier base in the next 12-24 months

Risk management

27%

view currency risk as the key supply chain management cost concern

Navigating new market conditions

How external factors are impacting risk and financing across supply chains

Trade finance

74%

are funding their supply chains using inventory financing

Digital payments

42%

pay their suppliers via electronic bank transfer

FX solutions

85%

will use forwards to hedge FX risk in the next 12-24 months

Ensuring supply chain resilience

How corporates are laying the foundations for future supply chains

Digitisation

46%

are looking for bank support to better visualise transactions across their supply chains

Sustainability

89%

are currently or planning to invest in supply chain sustainability

Sustainable policy implementation

67%

have implemented environmental policies across their supply chains

From August to October 2022, we commissioned East and Partners to directly interview 787 corporate treasurers and senior managers across 14 markets, including 66 in Germany, to find out how they are managing their supply chains. Respondents could select multiple answers for some questions.

This presentation was created by HSBC Trinkaus & Burkhardt GmbH ("HSBC Germany"). It is intended for information purposes only and may not be shared with third parties without express written permission from HSBC Germany.

This presentation does not represent any oer to conclude either a banking or securities service. The estimates included in this presentation do not represent any recommendations for action.

The information provided by HSBC Germany in this presentation is taken from sources that we consider to be reliable but have not been subjected to independent inspection HSBC Germany cannot guarantee, and assumes no responsibility for, the correctness and completeness of the information contained in this presentation.

The opinions given in this presentation are our sole view and subject to change at any time. We are under no obligation to publicise or inform others of any changes in opinion.

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