Why supply chains will make or break businesses in 2025

IN A world of increasing uncertainty, supply chains have become a business’s most critical asset — or its greatest vulnerability. The global shipping industry is grappling with mounting disruptions, from geopolitical conflicts to environmental regulations and infrastructure limitations. As 2025 unfolds, businesses in Jamaica and across the Caribbean must rethink their supply chain strategies to remain competitive.

Anna Hamilton, CEO of Jamaica Freight and Shipping Company Limited, said the ability to respond to external shocks is no longer optional — it’s essential for survival. “A strong supply chain is always important to a business. It is what will allow them to maintain their level of efficiency and ability to satisfy their end customers’ demands,” she said, adding that it “allows for transitions, if necessary, and reduces potential disruptions caused by external factors”.

However, predictability will be a significant challenge to businesses, said Neil Smith, CEO of Shipping Services Group of Companies. As an import-heavy nation, “Most of our industries are heavily reliant on a predictable, stable supply chain,” Smith said. “A strong supply chain allows businesses to forecast and make important decisions that allow them to grow and increase employment opportunities.”

Among the factors Smith noted are labour strikes, extreme weather events, and political decisions which may impact key trade routes. What’s more, he said, the International Maritime Organization’s vote to implement a pricing structure for a global greenhouse gas fuel standard to incentivise shipowners to become near carbon-neutral could lead to increased freight costs.

Already, the supply chain’s strength is being tested, as Hamilton noted the schedule reliability difficulties due to port congestion in the region. “In addition, with the ongoing Red Sea crisis and recent rumblings from the US regarding proposed tariffs and increasing comments being made regarding the Panama Canal, we can expect continued delays and possible increases in the cost of goods.”

Amid these disruptions, both agree that businesses should increase technology use to gain visibility in their supply chains. Real-time tracking, automated inventory management, and digital logistics solutions are becoming essential tools, Hamilton said.

Despite advances in technology, critical statistical data on Caribbean trade is lacking, which limits the potential to optimise regional supply routes, Smith said. If corrected, “This would amplify Jamaica’s position as a regional logistics hub, as we are strategically positioned to lead regional logistics by both ocean and air.”

Additionally, the industry experts said relying on a single supplier or trade route has become a high-risk strategy. Businesses must proactively diversify their sourcing and shipping routes to mitigate the impact of unexpected delays. Hamilton said, “With all the changes occurring globally and potential threats/disruptions to shipping routes, it is important for businesses to explore new avenues to ensure continuity in their companies.”

Smith went further, urging Caribbean businesses to tap into regional suppliers that may offer cost advantages under CARICOM trade agreements. “It is important to diversify suppliers because any trade route can become delayed at a moment’s notice. Having regional partners increases a business’s ability to provide for their clients. This, again, is why regional statistical data is so important. If you don’t know what your neighbour is producing, you wouldn’t know that it is an option, and they do not know what we, in Jamaica, can provide.”

Preparing for supply chain disruptions requires careful planning, forecasting, and financial flexibility. Hamilton advises businesses to take a hard look at current and projected demands. “There will be a need for a renewed approach to business and how purchases are scheduled, and from where,” she said, continuing that modernising the Caribbean’s logistics infrastructure is key to creating a more resilient supply chain. This includes investments in port automation and equipment upgrades.