Manufacturing and Supply Disruption Risk from Concentration among Outsourcing Partners
First written in FY2024. 2 of 3 entries say "Mitigated", first in FY2025-H1. Latest entry: FY2025.
The whole theme swung hardest in 2018: 2 of 6 companies on the "Worse" side.
4 other companies' latest entry also says "Mitigated".
- FY2025MitigatedAnnual report
「During the fiscal year, we had secured a sufficient level of inventory in advance, enabling us to minimize shipment adjustments even amid the sharp increase in demand for test kits around the year-end and New Year period.」
The company explains that sufficient inventory minimized shipment adjustments during the fiscal year, despite the prolonged shortages and shipment adjustments in the previous fiscal year. The concentration risk among contract manufacturers remains. - FY2025-H1MitigatedAnnual report
「In the fiscal year ended June 2024, we adjusted shipments because of shortages over an extended period from around September to around February. In the fiscal year ending June 2025, assuming that the impact of shipment adjustments for major products would not recur to the same extent as in the previous fiscal year, we expected revenue from the third quarter onward to exceed the previous year’s level. Although the influenza outbreak began later than in the same period of the previous year, we had sufficient inventory after the outbreak began in earnest in December, which was reflected in performance and resulted in higher revenue year on year.」
The company explains that securing sufficient inventory reduced the impact of shipment adjustments for major products and enabled it to capture year-end demand. It does not state that the concentration risk among contract manufacturers has been eliminated. - FY2024First statedAnnual report
「We normally maintain approximately 2–3 months of product inventory to minimize risk. However, if a change in a contract manufacturer’s policy or other factor prevents us from outsourcing work to that manufacturer, it may become difficult to manufacture and supply products.」
Responses include securing multiple contract manufacturers, strengthening in-house production, and maintaining approximately 2–3 months of inventory.