WEBVTT

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- Everyone's anticipating a
potential economic downturn

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and that has major implications

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for how companies manage
their supply chains.

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But they need to learn from
their mistakes during Covid.

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In early 2020,

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companies were afraid of a
drop in demand,

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so they shut down plants,

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let go of workers, and
stopped buying raw materials.

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But when demand quickly
bounced back,

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many companies could
not ramp up fast enough.

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In some cases,

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it's taken years to catch up.

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Right now,

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companies should be scenario-planning

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and carefully considering
where and how deeply to cut.

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The key is to figure
out where an investment

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in continued capacity
has the potential

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for the greatest returns.

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Whether it's their most
profitable products

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or those most likely to suffer
from market-wide shortages.

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When demand does return,

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they can capture market share
from unprepared competitors,

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gains that they'll be able
to retain for the long term.