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Channel Choke: Demand spikes create product shortages

An analysis of product availability across sectors

January 25, 2011

Availability of product and raw materials has become a challenge for some distributors as demand continues to improve. This article looks at the sources of the problem, the outlook for 2011, and how companies can improve forecasting in a volatile environment.

Manufacturers that had to make significant cuts to operations during the Great Recession are now struggling to ramp up, and some distributors are finding themselves unable to locate the product necessary to meet spiking demand.

"It takes time for companies who had to scale back to get back to the breadth of their product lines," says Norbert J. Ore, chairman of the Institute for Supply Management Manufacturing Business Survey Committee. "As a result, some companies have had spot shortages, particularly of components."

Nearly half (48 percent) of respondents to the annual MDM Reader Survey in November …

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