Published on: September 17, 2025

Geopolitical events, compounded with trumps recent tariffs, have brought global supply chains into the spotlight.  And for good reason. We thought it would be interesting to do a high level primer to help manufacturers, processors, distributors, and retailers have a better way to think about supply chains.

“There are no such things as solutions.  Only trade-offs.” – Thomas Sowell

Efficiency

At its core, supply chain management is essentially a trade off between resiliency and efficiency.

For the last 50 years, efficiency has been the defining mantra (and goal) of global trade.  But what does that mean?  It means massive economies of scale, more limited products, fewer suppliers, and more centralization.

Sounds obvious.  Why wouldn’t you want to be more efficient?

Let’s say our fictional company makes widgets.  The fewer widgets we make, the more production time we can spend churning out larger volumes.  The larger we become, the more buying power we have and the cheaper we can make our goods.  If we have fewer, larger customers, we can focus on driving most of the volume through them.  All in the name of ‘efficiency’.

The trade off?  Well, we saw this clearly during the pandemic.  The USA didn’t make anything domestically when it was in dire need.  Masks, drugs, therapeutics, etc were largely made in China.  It outsourced manufacturing of these items in pursuit of low cost efficiency, but at the expense of resiliency.  What you gain in costs and scale, you also lose in terms of independence.

Resiliency

Resiliency can best be explained by a quick story I will steal (or rather paraphrase) from a Jack Stack book I read some years back.

A man ventured to Asia to see a fireworks manufacturer he wanted to do business with.  When he finally got to what he thought was the manufacturing plant, all he saw was several huts dotted on a hill.  It turned out that the huts were the factory.  Why?  Because if any of the huts accidentally blew up, all the other huts could keep producing (they were making fireworks, after all).

This covers it beautifully in a nutshell.  Hallmarks of a resilient supply chain are self-sufficiency, independence, and decentralization.  What you lose in cost you gain in flexibility and speed.  And speed is a force multiplier.

How You Should Be Thinking About Supply Chains

If you’re operator today and you’re head is spinning thinking about supply chains, procurement, and how it affects your business, here’s a few tips to help you move in the right direction:

1. Determine how you want to build your supply chain

Are you more focused on resiliency, or efficiency?  For most people it ends up being something closer to a hybrid model.  The important point here is to understand what are critical areas you want to focus on being efficient or resilient.  How do things look now, and how would you like them

2. Realize that some level of resiliency is probably a good idea

If efficiency has been the buzz word of the past, resiliency might be the buzz word for the future.  We would highly recommend starting small and focusing on one or two key areas where flexibility and self-sufficiency would be a priority, and start building from there.

3. Diversification is the holy grail of supply chain efficiency

Global trade will never come to a complete halt.  However, the growing amount of geopolitical tensions and political populism will disrupt normal supply lines and global trade in the near to medium term.  US tariffs are just one example.  Having the ability to strategically diversify will be critical for small and medium size businesses, who will bear the brunt of these disruptions.  Yes, it’s more work dealing with more vendors, setting up multiple contracts, and looking at different partnerships globally.  But in the long run, it’s worth it.

Rockledge Trading is a specialty distributor & consultant specifically within food and beverage.  We work globally and help manage sourcing, logistics, and inventory for distributors, food manufacturers, government agencies, and non-profits.

We also consult on a specialty basis, helping with everything from operations, R&D, market analysis, and management.

If you’re looking for help in any of these areas, you can DM me personally or reach out at RockledgeTrading.com