Global Contraction and Local Strengthening of Firms’ Supply and Sales Logistics Networks in the Context of COVID-19: Evidence from the Development Zones in Weifang, China

Abstract

The stagnation of multinational and cross-regional goods circulation has created significant disruptions to manufacturing supply chains due to the outbreak of the COVID-19 pandemic. To explore the impact of COVID-19 on the circulation of manufacturing industry products at different geographical scales, we drew upon a case study of development zones in the city of Weifang in China to analyze the characteristics of firms’ logistics networks in these development zones, and how these characteristics have changed since the outbreak of the COVID-19 pandemic. The data used in this study were collected from fieldwork conducted between 26 August 2020 and 15 October 2020, and included the supply originations of firms’ manufacturing sources and the sales destinations of their goods. We chose the two-mode network analysis method as our study methodology, which separates the logistics networks into supply networks and sales networks. The results show the following: First, the overall structure of firms’ logistics networks in Weifang’s development zones is characterized by localization. In the context of the COVID-19 pandemic, the local network links have further strengthened, whereas the global links have seriously declined. Moreover, the average path length of both the supply and sales logistics networks has slightly decreased, indicating the increased connectivity of the logistics networks. Second, in terms of the network node centrality, the core nodes of the supply logistics networks are the development zones and the city in which the firms are located, whereas the core nodes of the sales logistics networks are the core companies in the development zones. However, since the outbreak of the COVID-19 pandemic, the centrality of supply originations and sales destinations at the local scale has increased, whereas the centrality of supply originations and sales destinations at the global scale has decreased significantly. Third, the influencing factors of such changes include controlling personnel and goods circulation based on national boundaries and administrative boundaries, forcing the logistics networks in the development zones to shrink to the local scale. Moreover, there are differences in the scope of spatial contraction between supply logistics networks and the sales logistics networks.