Supply Chain Management: Shipping Your Way Out of the Crisis

It’s mayday for global supply chains and supply chain management. The world has never seen a crisis this widespread before. The disruption is especially evident in the record high rates of container freight.

The Supply Chain Situation

The COVID-19 pandemic for one has contributed to the unprecedented rise in consumer goods demand from Asia. The few available ships, closure of Chinese factories, and shortages in the labor force of the importing countries resulted in significant delays, considering that China accounts for around 12% of global trade.

The Ever Given blockage of the Suez Canal during transportation caused great economic loss, with an estimated daily damage of 1$2M to $14M to Egypt alone. It halted trade operations in the canal for six days, causing a daily global damage of $10B.

Who can deny the massive negative impacts of the Russia-Ukraine war on the global supply chain? The flow of goods was greatly impeded, causing dramatic rise in prices and product shortages. Both Ukraine and Russia produce about ⅓ of the world’s wheat, ¼ of the world’s barley, and ¾ of the world’s sunflower oil—all critical commodities for food. The blockage of ports to and from Ukraine and Russia, coupled with the states’ sanctions resulted in high freight costs and surging gas prices for all modes of transportation. There was a crazy competition among the train routes connecting the warring regions, namely Belarus, Poland, Germany, France, and other European countries.

All of these global events led to port congestion, which necessarily reduced effective container logistics capacity.

The Crisis Ripples

The scale of the impact was incomparable. The escalation was so fast that companies had to ensure end-to-end assessment, monitoring, and optimization. Supply chain disruptions are already a known phenomenon, but it seems that when the world faced it big time, not even the economy giants were ready.

Nobody saw this coming.

We’re not just having a pandemic, or a trade canal blockage, or a war. We’re having a scarcity of the most common commodities. International markets, and soon the global economy, plunged as the catastrophic events hit one after the other.

The world helplessly watched as international supply chains were disrupted. And the most beat sector of them all? The shipping industry.

The Shipping Industry

We know the shipping industry is indispensable for the continuance of global trade. It’s the backbone that connects regions, carrying 90% of all internationally traded goods. No wonder why it is worth trillions of dollars.

Together with the rising demand for freight comes the increase in maritime trade volumes which are predicted to triple by 2050. This only means that lack of alternatives will eventually prolong the current pressures the shipping industry is facing.

The ongoing crisis has forced global manufacturers to outsource some of their raw materials from different countries at the same time, with a view that one delivery would most probably get delayed at sea. But the hardest question to ask is, “Is this sustainable?”

Practically, no. This kind of method is way too expensive for most shippers. A study conducted by Censuswide found that 45% of the 750 UK brands selling consumer goods online claimed that shipping costs are their toughest challenge to global expansion. According to the same study, shipping a shoebox-sized parcel from the UK to the US costs about £20.56, triple from its original price of £15.73 in a span of 12 months.

This is the reality of the shipping industry today.

For most manufacturers, reshoring might not be an option. While it can help boost the national economy, you can’t afford to risk having negative implications, not now when the supply chain crisis is still ongoing. And if you don’t find ways to cut your shipping costs, can you find a future for your business?

Let’s Help You Out

If there’s a two-word solution to all this buzz, it’s “shipping resilience.” But that’s too broad of an answer for a global supply chain crisis. We can narrow it down to the ultimate remedy—technology.

Forceget

The supply chain is an industry process that is so complex and time reliant. It is critical for you to be able to address potential issues as they come. No worries! There is a digital freight forwarder that helps you with exactly that problem.

With Forceget, you can get full control and visibility of your global supply chain via their intuitive digital platform.

They give you options like ocean freight, air freight, shipping to Amazon FBA, warehouse & distribution, customs brokerage, and even cargo insurance.

It’s the one-stop-shop for your goods, containers, exceptions, clearances, and more!

If you’re looking to get a comprehensive and real-time view of your supply chain, quote for your offers, book your shipments, pay your bills, and track your inventory levels—all at the palm of your hands, connect with them now!

VAA

The global economy has become paralyzed for so long that even catching up to consumer demands feels like catching your breath in a vacuum-sealed room. There’s just so much work to do! But that’s a good thing. It only means you are continuing to thrive despite the adversities.

So how do you address workload congestion? The answer is obvious, and that is delegate. It’s never not a good idea to get some helping hands. But you have to be careful—helping hands don’t have to mean many, they just have to be reliable and efficient.

As you transition into digital logistics with Forceget, you will need help from people who can facilitate the end-to-end processes to substantially lessen the hassles on your part.

Virtual Assistant Academy (VAA) can provide you with virtual assistants who are not only trained to support your needs, but are also experts in specific areas of business processes.

You can focus on scaling your business, and your VAs can do the rest.