Retail industry experts urge retailers to stress‑test contingency plans as lead‑time uncertainty grows.
With tension ramping up in the Middle East, and the war showing no signs of ending, it’s increasingly inevitable that retail supply chains will be affected. “Rising oil and gas prices might grab the headlines but escalation across the Middle East will result in price hikes across all industry supply chains,” says Sam Coyne, CEO Europe at Currenxie. “The crippling of key trade routes will prolong uncertainty and continue to drive up supply costs, squeezing merchant margins ever further and ultimately leading to a spike in the cost of consumer goods and surging inflation.”
Cost of goods set to rise
This will impact on the cost of goods, warns Coyne. “Recent research from the Chartered Institute of Procurement and Supply (CIPS) recently warned that due to rising costs of transport, energy and raw materials, consumer goods prices could soar during 2026,” he says. “Recent events are likely to make such forecasts inevitable and global businesses and consumers will rightly be hugely concerned of the longer-term impact on supply chain costs and the price of products on the shelves.”
From an operational perspective, the challenges are equally clear. “Geopolitical disruptions in key trade regions inevitably create ripple effects across global supply chains, particularly for sectors such as food and drink, retail, and fashion that rely heavily on international sourcing and tightly managed inventory cycles,” says Jon Bahl, CEO of Linnworks. “From an inventory management perspective, the primary risk retailers face is uncertainty around lead times. When shipping routes, manufacturing hubs, or transportation networks become unstable, retailers can experience delays that disrupt replenishment schedules and create stock imbalances across sales channels.”
What retailers need to do
So, how can retailers protect their consumers – and their margins – as much as possible? “Tensions around the Strait of Hormuz are forcing supply chain leaders to ask a question most would rather not face: if this corridor closes, how would we actually respond?” says Jonathan Barrett, CEO, Kallikor.
The challenge, he points out, is that these plans often rely on assumed responses rather than tested outcomes. “In practice, it can be difficult for organisations to see how different decisions – rerouting shipments, adjusting sourcing, reallocating inventory or changing service commitments – will actually behave across the entire supply chain once disruption begins,” he says.
It’s not an unprecedented scenario for retailers, and many will have emergency plans in place. “We’ve seen this before through the Suez Canal obstruction in 2021 and the Red Sea shipping disruption in 2023–2024, when pressure in one part of the global trading system forced companies to make rapid operational choices with limited visibility into the wider consequences,” says Barrett. “Many companies we work with have an answer on paper for how they would respond to disruptions like these.”
As ever, preparation is key. “The ones with most confidence in that answer have already tested it — running scenarios to see how those decisions will actually behave across the supply chain before disruption forces the choice,” Barrett states. “The organisations navigating disruption best are rarely the ones reacting fastest. They are the ones that have already explored the scenarios and understand how their supply chain will behave before disruption forces the decision.”
The importance of operational agility
Jon Bahl adds that there’s a tendency for retailers to behave cautiously at times such as these. “What we typically see in these situations is retailers shifting toward more cautious inventory strategies-holding slightly higher safety stock on key SKUs, diversifying suppliers where possible, and closely monitoring sell-through rates to avoid both shortages and excess stock,” he says.
“The broader lesson for retailers is that resilience increasingly depends on operational agility. Having accurate, centralised inventory data allows businesses to respond faster to global events-whether that means reallocating stock, adjusting fulfilment routes, or adapting sales strategies while supply conditions evolve.”
The unfolding situation places retailers in a difficult but familiar position: uncertainty is unavoidable, but vulnerability is not. Those who treat scenario‑planning as a continuous discipline rather than a crisis response are already better prepared. With energy markets volatile, shipping corridors unstable and inflationary pressure rising, the retailers most likely to withstand the months ahead will be those that have rehearsed disruption before it arrives – strengthening visibility, diversifying supply, and building the agility to pivot quickly when global conditions change.
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