“Supply chain risk can destroy shareholder value. The fact is, the supply chain underpins every part of an organisation’s bottom line. From purchasing strategy to warehousing, inventory controls to distribution – every element of the supply chain impacts on the operating income and balance sheet.
“Singhal and Hendricks previously analysed the impact on shareholder value of 861 profit warning announcements associated with supply chain difficulties. The effect on the shareholder value of these supply chain ‘glitches’ is about minus 20%.
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