https://www.construction-institute.

org/blog/2020/april-2020/covid-19-and-the-supply-chain

COVID-19 Economic Aftermath No. 1 – The Supply Chain in Peril

Part of the impact of COVID-19 has been reduced staff to perform quality inspections. Some owners,
EPCs and AECs are asking existing suppliers and producers of modular units for better verification to
assure the quality of the products they are acquiring. They are also considering improving inspection
of products as they arrive on site to ensure they meet appropriate specifications and standards. This is
a necessary precaution especially when a company shifts to a new supplier.

How COVID-19 is impacting the supply chain, and how companies are addressing it in three areas:

Immediate Term - It’s About Communication

1. Immediate & consistent reporting
-When there was immediate reporting between headquarters, suppliers and the field wherever
disruptions occurred, and then sharing that information corporate-wide to anticipate potential
problems on other construction sites for the same materials, supplies and modular units.

2. Internal assessment of the supply chain

-Companies conducted extensive internal assessments of project resources that were in the supply
chain and reviewed the status of COVID-19 in the resource origin or in the transportation chain along
the way. For example, modular units from China, although produced, were not shipped, impacting
modular yards here in the states where some now face potential closure.

3. Outreach - Locating and locking down other sources of supply or shifting what’s available to sites
that are still open
-Companies matched their list of current suppliers with that of other suppliers (both domestically and
overseas) and reached out to them regarding the state of their current and projected production on
relevant materials, supplies and modular units.

Plan Ahead - Looking down the road to the restart – “ready to go”
In anticipation of supply chain issues when projects are ready to restart, some companies are securing
materials now or placing orders ahead of the dates they will actually need them, in order to make
sure they minimize supply delays when demand returns.

A Caution - Quality Assurance

Part of the impact of COVID-19 has been reduced staff to perform quality inspections. Some owners,
EPCs and AECs are asking existing suppliers and producers of modular units for better verification to
assure the quality of the products they are acquiring. They are also considering improving inspection
of products as they arrive on site to ensure they meet appropriate specifications and standards. This is
a necessary precaution especially when a company shifts to a new supplier.

For companies that operate or have business relationships in China and other impacted countries,
steps may include:
• Educate employees on COVID-19 symptoms and prevention
• Reinforce screening protocols
• Prepare for increased absenteeism
• Restrict non-essential travel and promote flexible working arrangements
• Align IT systems and support to evolving work requirements
• Prepare succession plans for key executive positions
• Focus on cash flow