More than two years into the global pandemic, supply chain snarls persist for a large portion of middle market American businesses, with smaller midsize firms in many respects bearing a significant amount of the pain, according to proprietary data from RSM US LLP—and companies continue to pivot accordingly.
Nearly half of respondents to RSM US’ latest Middle Market Business Index survey—48%—said in April that their organizations experienced significant negative effects due to unexpected changes or disruptions in supply from an upstream supplier during the previous 12 months. The survey polled middle market executives from April 4 to April 25 on questions specific to supply chains, as well as questions about costs and inflation.
The MMBI survey showed a marked difference between smaller middle market organizations and their larger middle market counterparts on this front; among businesses with between $10 million and $50 million in annual revenue, 64% reported significant negative effects, compared to 36% for businesses with annual revenue between $50 million and $1 billion.
“We know middle market firms are significantly challenged in attempting to find alternative sourcing where those disruptions are the most severe,” said Joe Brusuelas, RSM US chief economist. “In particular, middle market firms with between $10 million and $50 million in revenue seem to be having the most difficult time adjusting."