The Need for Supply Chain Transparency in the Construction Industry

Construction companies face many risks while navigating throughout the industry. Some risks are inherent to the business, like high insurance costs due to the physical challenges employees face. Other risks, such as maintaining a transparent supply chain of appropriate materials, are unnecessary and can lead to much larger issues for construction companies.

According to a survey of directors, procurement mangers and buyers throughout 131 UK businesses, many construction companies admitted they “…do not know who their suppliers’ suppliers are. Of all industries surveyed, the construction sector was the least confident that its data about suppliers was robust and verifiable…60% of construction companies had doubts, or were dissatisfied, about the ability of their supply chain to mitigate against potential risks. And more than half of them were aware of a supplier failing to meet compliance requirements.”

There is a significant lack of information and communication between the construction companies and Tier 2 and below suppliers. The issue is that companies “…remain ‘confident’ about their ability to manage supply chain risks.” This false confidence encourages a lack of transparency and complacency that may end up coming back to bite the industry, similar to the recent horsemeat scandal.

Supply Chain Management has reemerged as an increasingly valuable skill over the past decade, and technology has made the disorderly process much easier to visualize. Programs now exist to manage employees, materials, and multiple projects. Our industry experts can help manage your supply chain and improve transparency throughout the process, saving your company’s reputation and from long term penalties. Contact SBS Group for more information and follow our updates on Twitter, Facebook, and join our LinkedIn Group.