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Best Friends Forever

Companies realize their success is firmly bonded to their suppliers' solvency and capacity to ramp up quickly, so they seek new ways to analyze supply chain risk.

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The flow of credit from financial institutions all but froze starting in late 2008, and although it has thawed somewhat, suppliers’ financial risk remains at the top of their corporate customers’ concerns. What happened in the car industry as the credit crisis struck in the fall of 2008 was a harbinger of the closer ties that now bind companies to their suppliers. Plummeting car sales had dire ramifications for parts suppliers, many of which depend on their sales to the manufacturers.

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