**London**: A study of over 1,000 mid-market companies shows those investing in supply chain technology and agility recover stock value faster after disruptions, while laggards face prolonged losses and investor scepticism, highlighting the critical role of proactive supply chain management amid rising global volatility.
A recent analysis of supply chain disruptions has shed light on the significant impact these challenges have had on publicly traded companies’ stock performances, revealing a clear divide between those that invested in supply chain resilience and those that lagged behind.
The study, based on over 1,000 earnings reports from mid-market companies over five years, found that businesses prioritising technology integration, real-time visibility, and operational agility managed to maintain investor confidence and saw their stock prices recover more rapidly after disruptions. Conversely, companies that neglected to modernise faced prolonged interruptions, rising costs, and scepticism from investors, resulting in poorer stock market performance.
Mahesh Rajasekharan, CEO of integration software provider Cleo, which conducted the research, remarked in an interview with Business Wire: “Uncertainty is the new normal in supply chains. The past five years have shown us that disruption isn’t an exception—it’s an expectation. From pandemic-driven shutdowns to geopolitical instability and climate-related crises, volatility is the only certainty.”
Key findings of the report include a notable spike in supply chain discussions during company earnings calls, jumping to 27% in 2022 from just 2% in 2019, highlighting growing investor attention to supply chain issues. The average recovery time from pandemic-related supply chain disruptions was around four years, with mentions of supply chain impacts dropping to 10% in earnings calls by 2024.
The study also identified that companies with agile supply chains and expanded supplier networks performed better; 51% of those reporting stock gains pointed to enhanced control over supplier onboarding as a critical factor. However, recovery times varied widely, with stock prices taking on average 176 days to bounce back, and in some cases over 1,000 days.
Additional insights revealed that nearly half (46%) of laggard companies cited supply chain disruptions during earnings calls, while 37% reported delays as contributing to underperformance. Notably, order backlogs emerged as a dividing point, with 42% of companies experiencing stock declines blaming backlogs for hurting earnings, in contrast to 50% of successful companies leveraging backlogs to drive growth.
Rajasekharan emphasised the importance of preparation in overcoming such volatility, stating: “The companies that thrived didn’t just react to disruptions—they prepared for them. The difference between winners and losers came down to proactive strategies: Companies that diversified their supply chains and invested in automation turned volatility into opportunity.”
The report underlines the necessity for businesses to adopt proactive supply chain orchestration strategies, utilising integration platforms, automation, and AI-powered analytics to safeguard competitiveness and support sustainable growth amid increasing disruption complexity.
The analysis focused on mid-sized firms within the Russell 2000 index, spanning sectors like basic materials, consumer goods, industrials, and technology. It examined stock price fluctuations within a one-week window before and after earnings reports that referenced supply chain issues, drawing correlations about the financial impact of supply chain robustness.
As global supply chains continue to face unpredictable challenges, these findings suggest that companies investing in modern, flexible approaches to supply chain management may be better positioned to weather future shocks and maintain investor trust.
Source: Noah Wire Services
