How supply chain disruption is reshaping product development

The Strait of Hormuz, which under normal conditions carries roughly a quarter of the world’s seaborne oil trade and a similar share of liquefied natural gas, has been effectively closed to commercial shipping for more than two months. Major carriers including Maersk, CMA CGM, MSC and Hapag-Lloyd have suspended transits. Brent crude is sitting above ninety US dollars a barrel. Analysts and freight industry surveys are now planning for disruption that runs well into the second half of 2026.

For anyone building a physical product, the implications are immediate. Lead times on critical components have stretched. Prices have moved sharply. And the disruption is compounding, with delays at one stage of the supply chain pushing back every stage that depends on it.

At Blender, we’ve spent the past few months helping clients work through these conditions, often by reaching for a playbook we developed during COVID. The lesson from that period was that traditional product development sequencing no longer holds. That lesson now applies again.

The most direct disruption is energy. Sustained pressure on shipping routes through the Persian Gulf and the Red Sea has pushed oil prices up, raised freight rates, and lifted war-risk insurance premiums to levels not seen in years. But the real impact for product developers is downstream of that.

The first is the squeeze on semiconductors and other key electronic components. Lead times that were typically four to six weeks have moved out to three months or more. Some critical components are now being quoted at close to a year. Costs on some lines have moved by as much as 50 percent.

The second is the compounding effect through plastics and other oil-derived materials. Plastic supply chains are being affected from both the raw material end and the shipping end. The full extent has not yet flowed through to downstream manufacturers, but the pressure is real and building.

Layered over the top of this is the continued rise of AI and data centre construction, which is driving up demand for the same categories of silicon that are now harder to source. The result is a volatile mix of constrained supply and rising demand, particularly in electronics and complex hardware.

Traditional new product development is sequenced like a relay race. Concept comes first. Then design. Then engineering. Then prototyping. Purchasing and manufacturing planning come later, often stage-gated to the point where supply chain conversations only begin once the design is nearly locked in.

That sequencing works when components are abundant and lead times are predictable. It fails when they are not.

“What we learned during COVID is that you cannot run a development project as if procurement is the last conversation,” says Ollie McDermott, co-founder and Design Director at Blender. “The components you need to build prototypes are now the same components that have 12-month lead times. If you only start that conversation at the end of design, the project is already 12 months behind.”

The cost of this misalignment is not theoretical. We’ve recently seen quotes of more than 50 weeks on single specified components. For a startup or a corporate engineering team running to a market window, a lead time of that length on a critical part can mean missing the launch entirely, or being forced into expensive last-minute redesigns to substitute what is actually available.

Our response, refined through COVID and now applied again, is to invert the model.

In practice, this means bringing supply chain into the conversation at the start of a project rather than the end. System architecture and platform decisions are still made early, as they always have been. But the work to validate component availability, secure suppliers, and even place advance orders now happens before hardware layout begins in earnest.

This is not a change to the design process so much as a change to its sequence. The same disciplines are involved. The same outputs are produced. But purchasing decisions that used to come at the end of the waterfall are pulled forward into the first stages.

Once you’ve got your system architecture and your platform architecture locked down, you should look at the supply chain and potentially purchase ahead, well ahead, even before beginning the hardware layout. It forces you to do the hard work up front to validate the key risks. And that’s actually a good thing. It means you’re mitigating risk earlier, not later.

The approach has practical consequences for how a project is scoped. On a current new product development project, our first task is not concept work or industrial design. It is securing supply of the critical components needed to do the work at all. The entire project is sequenced around the delivery of those components from a module supplier.

That would have been an unusual way to start a project five years ago. It is now becoming standard practice.

We operate as a commercialisation partner rather than a design studio, which means supply chain conversations are part of the brief from day one rather than handed off to someone else later.

In practice, that looks like:

Forward planning across disciplines. System architecture decisions are made with explicit reference to the supply chain implications of each component choice. The question is not only whether a component meets the technical brief, but whether it can be sourced within the project timeline.

Realism about substitution. Some components, particularly system-on-module and system-on-chip platforms, cannot be casually substituted. The entire product architecture is built around them. Identifying these dependencies early, and securing them early, is a core part of de-risking a project.

Honest conversations with clients. Clients producing higher-volume products have been briefed on potential disruption to raw plastic supply. The aim is not to drive panic ordering, which only worsens supply conditions, but to give clients the visibility they need to plan stock and production scheduling realistically.

Active supplier engagement. Knowing your suppliers, visiting their factories, understanding their layers of sub-suppliers. This is the work that makes supply chain resilience possible. It cannot be done from a desk during a crisis. It has to be in place before the crisis arrives.

The end of just-in-time as a default operating model is one of the clearer consequences of the past five years. The world was moving toward lean, just-in-time, made-to-order manufacturing before COVID. That model broke. It is breaking again now.

For founders, technical teams, and corporate engineering groups working on new products, the practical implications are straightforward.

None of this removes the disruption. But it does change a project’s exposure to it. A development sequence that puts purchasing first builds in the option to absorb supply chain shocks rather than be ambushed by them.

The deeper shift is that product development partnerships now need to span further along the journey than they used to.

A consultancy that hands over a working prototype and leaves the client to manage manufacturing alone is not equipped to anticipate the kinds of disruption that are now routine. A partner that stays involved through component sourcing, supplier selection, tooling, production and quality engineering is. The difference can be the difference between launching on time and launching twelve months late.

That holistic approach is no longer a nice-to-have. It is increasingly the difference between products that reach the market and products that stall on the way.

Blender works with founders, technical teams, and established brands across New Zealand and Australia, taking products from concept to commercial reality. Contact Blender today to discuss your project.