May 16, 2016 - 3:15pm

Global Supply Chains: A Big Win for Consumers, U.S. Businesses


Former Managing Editor, Digital Content

Editor's note/update: Mark Wallace, UPS senior vice president of Global Engineering and Sustainability, spoke at the 4th Annual Global Supply Chain Summit. See an adapted version of his speech that ran on Medium: In Global Trade, Minutes Matter.

It is easy to take things for granted when you run to the store or go online to buy that special birthday present. You put an item in your cart or click a button – and, voila, the purchase is complete.

Simple, right? Well, simple for you. But it is important to step back and connect the dots to see what makes it all possible – global supply chains.

U.S. businesses are linked together through a global web of interconnected, predictable and efficient supply chains. They rely on these global supply chains to access international consumers and compete in the global marketplace. Improvements that address cross-border friction smooth the flow of trade and ensure timely delivery.

Manufacturers import and export parts and supplies from around the globe. They bring those products together in a just-in-time delivery environment to enhance their competitive advantage and provide the best value for the consumer.

On Wednesday, the U.S. Chamber of Commerce will host the Fourth Annual Global Supply Chain Summit. This year's summit will focus on the future of global supply chains and how business can take advantage of new opportunities.

Check out the facts:

  • More than 28% of U.S. GDP is tied to trade, and that number will continue to grow. Accessing international markets without unnecessary trade burdens is critical to American leadership in the global economy.
  • Transportation and logistics represent 7.7% of U.S. GDP; by comparison, logistics costs represent 16% of China’s GDP and 12% of India’s GDP. This competitive advantage is critical to U.S. economic competitiveness.
  • Efficient supply chains translate into increased profits. AMR Research concluded that the average total return of companies on the “Supply Chain Top 25” was 17.89% compared with returns of 6.43% for the Dow Jones Industrial Average.
  • Countries with efficient logistics systems experience an additional 1% in GDP growth and a 2% increase in trade.
  • 56% of imports are intermediate goods, which makes trade facilitation critical to our manufacturers.
  • Inefficient border procedures can add as much as 15% to a product’s cost.
  • The World Economic Forum and the World Bank concluded that reducing supply chain barriers could increase global GDP up to six times more than removing all tariffs.

The Chamber promotes the modernization of global supply chains and cross border trade flow. Through this modernization we enhance the competitiveness of U.S. businesses and unleash the potential for small-and medium-sized businesses to access foreign markets. Everybody ends up a winner – all the way to your shopping cart or front porch.

About the Author

About the Author

Former Managing Editor, Digital Content

Eric Nelson is the former managing editor of digital content at the U.S. Chamber of Commerce.