Supply Chain Disruption: How Covid-19 Started It All

At the time this article is being published, it’s been 22 months, just shy of 2 years, with Covid-19. As time has passed and treatments and vaccines have become available, most (though not all) of life has returned to normal. A “new normal” as many now call it. In-person gatherings and events have returned, remote and flexible workstyles have become the new norm, kids are back in school, and online shopping and inflation have rapidly risen. So, what are we wishing wasn’t part of this “new normal”? Supply chain disruption.

The Start of Supply Chain Disruption

As COVID-19 began to spread, governments responded with lockdowns. Nonessential businesses closed, and panicked consumers bought out paper products, soap, and disinfectants. With many businesses closed or down to a skeleton crew, this meant longer transportation times. To make do, alternative routes and modes were sought out, but even those became backlogged too. Shipping networks started to become strained. With people staying home and governments offering financial help, online shopping quickly increased.

Amidst the waves of Covid-19 came more supply chain disruption. There was the Texas freeze that caused many manufacturing plants to shut down. Then there was the Suez Canal blockage which caused severe delays in imports from several days of being blocked. There were the wildfires that raged across the west coast, adding further supply chain disruption. As a result, companies have faced material shortages, increased freight costs, labor shortages, tight capacity, and more. 

Current Conditions

In the standard supply chain, raw materials get sent to factories to manufacture goods. Then shipped to warehouses for storage, then to retailers or consumers. Currently, companies face warehouse shortages, labor shortages, tight capacity, exponentially high freight rates, and import delays. It’s gotten so bad for so long that supply chain disruption continues to be a headline in the news. Even people not in or knowledgeable about logistics are talking about it. 

The hot topic in the news as of late is the overwhelming demand surging at U.S. ports. Demand for goods has grown so rapidly since the start of the pandemic that it’s equal to adding about 50 million new Americans to the economy, as reported by Insider. Lately, we’ve seen record highs in ships waiting to dock, containers waiting to unload, a lack of storage space to put goods, and empty containers sitting in truck lots and streets, with no place to go. 

What to Expect in 2022

Experts continue to say that we will keep seeing supply chain disruption and delays through 2022, if not to 2023. This is because we’ll still have our current supply chain bottlenecks to work through, labor, material, and warehousing shortages to figure out, and Covid-19 remains an issue. 

But perhaps we will begin to see some easing of supply chain disruption this coming year. For one, the recently passed infrastructure bill will hopefully begin to affect and strengthen supply chains through its funding into roads, bridges, and ports. More and better infrastructure will help keep certain supply chain disruptions at bay, such as offering more warehousing space and keeping bridges and roads safe and free from closing. Nonetheless, this is longer-term and farther out. 

Ideally, what would give the supply chain some short-term relief would be if consumers slowed down a bit with their online shopping. It’s still expected that consumer spending will at one point switch back to travel and entertainment at some port, but no one is quite sure when that may happen.

Tips for Shippers

The past (almost) two years have shown us that supply chains aren’t as resilient as we thought they were. Considering we’re still in the thick of supply chain disruption, it makes sense to improve your supply chain and logistics. Here are some tips you may find useful in keeping your business moving forward until we get back to normal.

Consider Shortening Your Chain

Global supply chains are seeing the worst disruption in their logistics. If anything’s come to light since Covid-19 began, it’s that businesses might want to look into shortening their supply chains. One way to do this is by moving your manufacturing back to the U.S., also known as onshoring. 

Identify Any Vulnerabilities 

By understanding where any risks lie, you’ll be able to better protect yourself from supply chain disruption. You’ll need to take some time to map out your entire supply chain, down to your distribution facilities and transportation hubs. Though this may be time-consuming and expensive, it can help prevent you from facing a surprise disruption that brings your business to a stop and can be much more costly. 

Diversify Your Supply Chain

Once you’ve identified where risk is in your supply chain, you can take that information to address it. This can be done by diversifying your resources. Instead of heavy dependence on one high-risk source, you can add more sources in locations that are not vulnerable to the same risk, so if one gets disrupted, you don’t have to be shut down completely. 

Begin Holding Safety Stock (if possible)

This may not be possible for all shippers, and now may not be the best time to start this considering all the current bottlenecks supply chains are facing. But, when possible, this is something that could save you from supply chain disruption down the road. 

Keep Up With Timely Communication

Communication is always needed to run your best business, but even more so during this pandemic. Make sure you are communicating properly and timely with your carriers and transportation providers on any new sanitation procedures, requirements, changes in operating hours, or upcoming closures. 

Also, Keep Transparency

Be transparent with your audiences. They appreciate it more than you think.

Stay Informed

COVID-19 and many other supply chain disruptions came quickly, and the future remains uncertain. Be sure to stay updated on current developments that may end up slowing down your business.

Find Support in a Transportation Partner

Third-party logistics companies, such as Trinity Logistics, can help you find creative ways to your logistics challenges. We’re experienced in complicated situations and stay knowledgeable on what is going on in the industry. We were quickly able to pivot when the pandemic first hit, so we could keep your business moving forward. We know that even in times of disruption, the shipping industry does not stop, so neither do we. 

If you’re ready to gain support in your logistics with Trinity Logistics, no matter the condition of the industry, let’s get connected.

Author: Christine Morris