The entire world is struggling with an inflation spike, plunging countries into long periods of instability. The primary reasons behind growing inflation are ongoing supply chain difficulties, transportation bottlenecks, higher fuel costs, rising healthcare costs, and more. New Zealand’s annual inflation rate rose 6% in the second quarter of 2023. The country’s largest contributors to inflation are rising prices for food, housing and household, recreation, culture, etc.

Inflation puts financial pressure on consumers, including business owners, because they have to pay higher prices for everything – products and services – they provide or use. 

Fortunately, businesses have found technology as an effective medium to combat the effects of inflation on personal and business finances. Historically, technology adoption has helped fight inflation because tech has been making products and processes better, faster, and cheaper. 

In this blog, we’ll discuss in detail how technology can guard against the impact of higher inflation.

Let’s get started:

Improves Labour Productivity

Artificial intelligence (AI) and automation can streamline repetitive and time-consuming tasks. This frees up employees to focus on other important and more complex business activities. This results in improved productivity as businesses can achieve more with the same number of workers. 

In addition, business intelligence and data analytics tools provide real-time insights. These insights can reveal loopholes in processes, identify underperforming areas, and discover inefficiencies in resource allocation. Accordingly, businesses can make informed data-driven decisions to improve their overall productivity.

In the context of inflation, increased productivity often leads to greater output without increasing costs, thereby restraining price inflation. This is how businesses can leverage technology to produce more without additional expenses in terms of labour or resources, resulting in lower per-unit costs.

Streamlines Supply Chain Operations

Combining technology with supply chain management unlocks a whole new level of efficiency. This efficiency allows businesses to smoothly navigate complex inflationary economic situations.

Here’s how:

  • AI-driven tools have revolutionised supply chain processes, from procurement to logistics. These advanced technologies make routine tasks faster and more efficient than humans, which reduces the need for manual workers, thus lowering costs. For example, automated inventory management software systems can track stock levels in real-time, trigger reorders as and when needed, and reduce the chances of stockouts.

  • By using machine learning tools and predictive analytics, businesses can gain an in-depth view of their supply chain operations. These tools can use real-time insights to predict future demand, allowing companies to adjust production proactively. As a result, businesses can optimise inventory, reduce wastage, and better manage their resources, which is crucial during inflation.

  • Blockchain technology in supply chain management levels up transparency and security. The immutable ledger of transactions helps prevent fraud and streamline activities like contract enforcement and cross-border transactions.

  • Technology also supports supplier diversification. Platforms that connect businesses with suppliers bring more sourcing options, enabling businesses to shift quickly if a supplier becomes too expensive because of inflation.

Promotes Sustainable Practices

Technology helps mitigate cost increases due to inflation by promoting efficiency and reducing waste. 

One area is improved resource management, thanks to innovative technologies. For example, smart energy systems optimise electricity usage, thus reducing energy costs. Similarly, water-saving technology optimises water usage, saving both money and the environment.

Cloud technologies reduce the need for physical infrastructures, thus eliminating the resources required to build, power, and maintain them. Companies can switch to cloud services and save on operational costs, which becomes increasingly vital during inflationary pressures.

One instance of how technology promotes sustainability is repairing and reusing electronic devices. For example, you significantly reduce electronic waste when you choose MacBook repair instead of replacing it. This helps conserve resources and create employment in the local repair sector, thus driving economic activity. In times of inflation, the costs saved by choosing Mac repair over replacement can be significant. 

Moreover, laptop repair increases the life of your devices, reducing the demand for new devices and thus lessening pressure on production. This has a knock-on effect of slowing down inflation resulting from increasing raw materials and production costs.

Optimizes Manufacturing

Automated assembly lines and robotics can speed up repetitive tasks involved in manufacturing. This increases production without a significant increase in labour costs, thus restraining cost-push inflation.

AI and machine learning technologies help in predictive maintenance. These technologies use algorithms that analyse data from machinery to predict potential failures. So, timely repairs help avoid downtime and the need for expensive production halts.

Similarly, digital twins – virtual replicas of physical systems – enable manufacturers to stimulate production processes without disrupting actual production. This results in optimised production, better efficiency, and reduced waste.

The 3D printing technologyallows for cost-effective manufacturing of custom and small-batch parts. This reduces material wastage and helps save on storage and transportation costs, which is significant during inflation.

Moreover, the Internet of Things (IoT) allows for real-time monitoring and tracking of your manufacturing processes. You can use sensors to gather and transfer data related to various manufacturing tasks. This data provides valuable insights that you can use to improve efficiency and minimise costs.

Act today to offset potential threats.

Although inflation brings risks for everyone, it can be more threatening to mid-market companies. So, they should take action now to offset the potential inflation challenges. The choice you make today will shape your future. So, allocate your IT funds meaningfully and thoughtfully without wasting them.

Some quick ways to act now are:

  • Identify your primary challenges and interrogate your data accordingly.

  • Cut down on costs using automation.

  • Engage stakeholders for digital investments in your business.

  • Simplify and streamline all your internal business processes.

  • Upgrade your systems to bring innovation to your business.

How can 73Inc help leverage technology to hedge against inflation? 

The quickest answer is – to reduce your electronic waste. We specialise in Mac repair services and can address almost all kinds of issues with your MacBook. So, bring your device to us, get it repaired, and avoid electronic waste while saving money on buying a new device.