@Risk

News that Iceland’s three McDonald’s restaurants — all in the capital Reykjavik — will close next weekend is yet another example of the terrible economic situation there.

But, there’s a sourcing lesson in the story, as well.

According to the news reports, Lyst Hr., the McDonald’s franchise holder in Iceland, was obligated to import all of the goods needed for its restaurants from suppliers under contract with McDonald’s Inc. In this case, that means meats, cheeses, produce — even packaging — for the “Golden Arches” in Reykjavik had to come from Germany.

But once the krona collapsed and import tariffs began to skyrocket, this sourcing scheme proved disastrous. Costs doubled, and Magnus Ogmundsson, the managing director of Lyst Hr., told the Associated Press it simply became impossible to raise Big Mac prices further and remain competitive with other restaurants in the area.

So, what’s keeping Reykjavik’s other restaurants afloat? You guessed it: they’re able to use goods sourced locally.

In fact, Lyst says he plans to reopen the stores under a new brand name (Metro), retain his current staff, and begin using locally sourced materials and produce.

Reading about his news from Iceland, I couldn’t help but be reminded of the report that said 67% of those polled feel that their executive team needs an education about the challenges and opportunities associated with global supply chain management.