Inverto: 83% of EU Companies Experiencing Supply Shortages

European companies are increasingly operating in a permanent state of disruption, as overlapping geopolitical tensions, supply chain constraints and cost pressures reshape the risk landscape, according to latest research from Inverto, a BCG company.

Stéphane Crosnier, Managing Director at Inverto, says: “The defining feature of today’s risk environment is not the severity of a single shock, but the fact that multiple risks are emerging simultaneously. Companies must continuously redesign their supply chain and risk strategies to remain competitive. 

“The greatest opportunity still lies in proactively strengthening procurement and supply chain resilience to reduce exposure to overlapping risks before they materialise.”

Supply chain shortages

Inverto’s study, based on a survey of over 400 Senior Executives in Europe, found that 83% of companies are experiencing ongoing supply shortages.

Supply shortages are up sharply from previous years, with disruptions driven by a broader mix of causes including supplier capacity constraints, logistics bottlenecks, insolvencies and continued conflicts across the globe.

Stéphane adds: “Achieving end-to-end supply chain visibility remains a major challenge for businesses. With multiple disruptions impacting supply, these factors are compounding the risk for businesses beyond their immediate suppliers. 

“Identifying risks further up the chain can help organisations to identify gaps before they become an issue that impacts productivity or the ability to deliver goods.”

Lack of visibility in the extended supply chain remains a particular weak point. Only a minority of companies have full transparency beyond their immediate suppliers, leaving them exposed to risks deeper within their supply chains.  

Procurement functions under growing pressure

Efforts to stabilise costs are proving increasingly difficult, according to the report from Inverto. 

While companies report improvements in supplier reliability and supply security, both up 5% points year-on-year, price stabilisation has weakened by 8 points to just 34%, underscoring the persistence of cost volatility across global markets.  

This is placing procurement functions under growing pressure, with quality, price risks and cyber security now emerging as the top priorities, each cited by nearly a third of respondents. In response, companies are beginning to redraw the map of global supply. 

Pivoting to resilience-led design

The research points to a marked shift from multi-sourcing trends in response to recent crises like Covid-19, the Ukraine war and trade tariffs, towards more concentrated and regionalised supply chains. 

46% of businesses are consolidating suppliers and around a third pursuing nearshoring or reshoring strategies. This shift is being primarily driven by trade tariffs. These moves confirm the broader pivot away from cost-optimised globalisation towards resilience-led design, but also introduce new tensions. 

“Companies are having to make difficult trade-offs,” Stéphane says.

“Many organisations are still determining how much resilience they are willing to pay for in front of such a volatile environment.”

A broad range of threats

European companies face a broad range of threats, including supplier reliability issues, geopolitical tensions, tariffs, cybersecurity risks and price volatility. 

Among 18 potential risks, no clear frontrunner emerged, with each risk mentioned by only 14% to 21% of participants.

Inverto says that the findings indicate risk can no longer be prioritised in isolation but must be managed as a system of interdependencies. 

The report also found that 89% of participants use digital tools for risk management, significantly up from previous studies.