Supply chains: What are they and why are they so important?

Video caption, Supply chains: What are they and why are they so important?

There have been problems recently because a lack of lorry drivers has meant fuel, food and clothing have not been delivered to petrol stations, restaurants and shops fast enough.

This has led to shortages at the petrol pumps, causing long queues for fuel, and some shops and restaurants running out of particular kinds of food.

In the last year, it has also affected big names like McDonald's, KFC, Nando's and Haribo - and has all been to do with supply chain issues.

Read on to find out how supply chains work and why they are so important.

What is a supply chain and how do they work?

A supply chain involves a small number of stages, from a product being made until it gets to the shops for people to buy.

Image caption, If we take sweets as an example, first the ingredients are taken to the factory
Image caption, At the factory the ingredients are turned into the sweets and packaged up
Image caption, Then the finished sweets are put into lorries to be taken warehouses
Image caption, From the warehouses they are then taken to to shops where they are unpacked and put on the shelf ready to be sold

What are the problems when they break down?

Each step is important and if there are problems during any part of the process, the chain can be broken - this causes delays.

If the demand for a product is greater than the rate at which it can be made available that can cause shortages.

What has caused the recent problems?

The pandemic caused lots of disruption to people's lives and restrictions on travel and coronavirus rules, like social distancing, had an impact on manufacturing, farming, meat processing and other industries.

There has also been a decline in the number of people who want to be lorry drivers so there are fewer available to make deliveries.

Brexit has also had an impact as it has made it more difficult for foreign lorry drivers, and other important workers, to work in the UK.

When will the problems be fixed?

The government has confirmed that 5,000 fuel tanker and food lorry drivers from abroad will be able to work in the UK for three months, until Christmas Eve to help with the disruption to supply chains.

The Army has also been helping transport fuel to petrol stations.

However, the lack of qualified lorry drivers is a long-term issue because lots of people are retiring and not that many new people are signing up to the job.