Whether we like it or not, new ways of managing the supply chain and logistics are being thrust upon us. What’s happening, and what are we doing about it?
With national economies reacting to a state of ever changing conditions, transportation companies are along for the ride, and just like everyone else, trying to adjust in real time.
With so many of us on lockdown, the change in the logistics landscape is generating some interesting statistics:
- Commercial transportation in the U.S. and Canada is operating at 89% capacity for heavy truck
- Transportation to grocery stores is at 90%
- Passenger flights are down a whopping 96%
- Grocery sales are up 38%
Diversification Is A Necessity
The foresight to see potential opportunities before they happen, develop strategies to reduce risk, and provide the ability to flex up or down will be key to success in the market.
Because they can quickly pivot to transport a variety of items, independent owner operators may realize the most benefits. If existing contracts are not at risk, a plan to assist another industry when volumes are down can be an effective option.
Old Systems Are Being Challenged
Those companies who have been resistant to technology are having a tough time under the current conditions, but that pain should provide incentive to review technology’s new tools.
Transportation, like many industries, is dealing with a long-standing and experienced workforce with many still using manual systems. Most of the day spent calling and emailing transportation providers, and juggling spreadsheets.
Regardless of how much experience your workforce has, it was probably not prepared for a disruption of this magnitude. Making the right decisions becomes an increasing effort as they’ve never experienced this kind of event before.
Businesses faced with unexpected demand have a difficult time trying to find capacity. In these situations, a customer would benefit from real-time API solution to get rates, truck confirmations, and then have a platform provider to source and assign the transportation vendor.
The Next Disruption Will Happen
When the next wave comes, companies that have invested in technology will be in a better position.
With the right technology, analytics, and metrics, companies could spotted trends as early as January. The analytics would have identified some of their clients increasing full truck loads to their stores.
In this scenario, analyzing the data wisely meant they had time to react before the disruption hit the market. Companies without a technology base had no idea and were unprepared.
Your plan of attack depends on your business, and the size and scope of your industry. It can be an opportunity to step back and measure the effects on your business and ask tough questions.
Funding technology projects is always a challenge, and transportation traditionally does not have the necessary capital to invest in expensive technology. In this case, there may be an opportunity to create more inexpensive offerings with mobile capabilities.
Adapting With Agility
This disruption will cause some companies to fail, others to flourish by adapting to serve what the market needs. The best defence is reviewing and reflecting on the data now to make fact-based decisions. As they say; “Go Science!”
COVID-19 will undoubtedly accelerate the demise of any who were already struggling. Any company that was marginal before the pandemic will surely not survive. And therein lies the opportunity for others more nimble to fill the gap.
Without appropriate processes and technology, responding to the next disruption will be nearly impossible. Companies that survive will have taken the opportunity to observe, learn from mistakes, re-evaluate strategies, and will ultimately be ready for the next round.