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How Changing Demographics Will Affect the Supply Chain

Have you considered how population growth, income, and aging is going to affect your global supply chain? If you haven't yet, you certainly will soon. Fariborz Ghadar (a William A. Schreyer Professor of Global Management, Policies an Planning) explains some of demographic changes that will be occurring in the coming decades, how that will affect supply chains, and what companies can do to be prepared for those changes. For example, the expansion of the middle class and education in Asia will result, ultimately in a projected 30 percent of world GDP being generated by countries like China, India, Korea, Japan, Thailand, and other countries that make up the southeast region of Asia. This shift indicates that existing supply chains outside of the region will more than likely find themselves moving close and closer to the area in one way or another. A rising growth rate in rapidly developing countries also affects the importance of meat and milk shipping ““ supply chains must consider how to refrigerate products to reach a new and expanded marketplace for their products. While all of this seems like quite a challenge, Ghadar makes sure to also point out the perks : On the positive side, businesses will have an unprecedented opportunity for meeting the needs presented by a new demographic makeup. New lifestyles and rapidly changing consumer preferences will generate new marketing opportunities. Businesses can play a significant role in mediating intergenerational differences by creating employment opportunities for older workers, deploying new technologies to enable higher productivity at older ages and linking labor groups across countries. Between the present and the future, the reality is that these three main characteristics of population change “” differential population growth rates, urbanization and immigration, and aging populations “” will combine to translate into a fundamentally altered business environment. Supply chains will become more and more important as more products are shipped further and to more people. Understanding what emerging markets will affect your supply chain can help prepare the organization for proactive versus reactive initiatives.

About Matthew Kabik

Matthew Kabik is the former Editor of Computer Aid's Accelerating IT Success. He worked at Computer Aid, Inc. from 2008 to 2014 in the Harrisburg offices, where he was a copywriter, swordsman, social media consultant, and trainer before moving into editorial.

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