As much as we wish it were different, the shipping industry continues to face significant challenges and hurdles in 2022.
The economic disruption of 2020-21 still hasn’t entirely cleared up, and there are numerous new issues to overcome as well. Reliable truckers continue to be in short supply and are also reducing the ability of companies to ship goods. Regulations on shipping continue to grow more burdensome, even as the industry needs relief more than regulation. Major changes in consumer purchasing and working habits are also impacting the industry and shifting demand.
And on top of that, the costs of fuel are skyrocketing due to geopolitical events and aren’t expected to fall any time soon, short of drastic government intervention.
This is manifesting as several significant supply chain challenges facing shipping operations of all sizes. In this article, we’ll take a look at some of the most common issues, and how they may be overcome.
Moving Past Six Common Supply Chain Challenges In 2022
1 – Achieving necessary capacity
Perhaps the single biggest challenge in shipping at the moment revolves around achieving the capacity necessary to fulfill your needs. Trucks and truckers are in high demand, and many operations are struggling to even get enough space to ship all their products or to receive the products they need to continue manufacturing.
Planning is key here. Shipments should be pre-planned as much as possible, to secure shipping space early. Shipping managers should also be looking to embrace strategies such as distribution pooling, zone skipping, and less-than-load truck sharing to reduce their need for individual trucks.
Partnering with a 3PL provider can significantly reduce these issues as well, by leveraging the 3PL’s existing shipping network.
2 – Reduced visibility and data-tracking issues
Optimizing your shipments and logistics requires excellent data-based overviews of your operation, as well as granular information of specific shipments and purchasing trends. Without this data, significant improvements become difficult or impossible to implement.
Shippers should be looking into technology solutions that will give them more visibility into their operation, end-to-end. This ranges from better tracking of stock in warehouses, to direct information about products in shipment and their current condition. These upgrades will be able to pay for themselves by enabling smart data-based strategies and predictions that improve efficiency.
3 – Maintaining compliance in increasingly complicated scenarios
As mentioned above, governmental regulations on shipping across the continent continue to grow. More data is being demanded by both US and Canadian authorities, with harsher penalties for missing or inaccurate information. Contractual compliance is also becoming an issue, with more missed or late shipments due to all the disruptions.
All this adds up to significant fees and penalties, not to mention a potential loss of reputation, that a shipping company simply cannot afford.
This is another scenario where partnering with a 3PL or 4PL logistics company may be the best option. They have the time and resources to maintain awareness of changing regulations and demands, as well as more fallback options to increase the chances of a shipment arriving on time.
4 – Unhappy customers
Frankly, the demands of customers in shipping scenarios can be borderline unreasonable, especially in light of all the problems facing the shipping industry. Nevertheless, customers want their products, and they want them now. When dealing with other businesses, their own operations may depend on suppliers meeting strict demands, further increasing their drive to find successful shippers who won’t make excuses.
In short, fair, or not, you have to do whatever it takes to fulfill the needs of your customers, or else they’ll just go somewhere else.
Beyond previously mentioned solutions for improving efficiency and shipping completion rates, you can help improve customer satisfaction by offering more value-added services. For example, consider linking your tracking database to a customer-facing portal that gives them as much information about their shipments as possible. Also, be sure to pay attention to complaints and take them seriously. A customer who is taking time to complain may still be retained.
5 – Inefficient reverse supply chain logistics
Even if your outbound shipping is relatively stable, what about shipments going in the other direction? In our experience, companies often have limited reverse supply chain capacity, causing them to waste money whenever a return or repair occurs. While many companies think that they can avoid returns with better products and services, the reality is that there will always be a substantial bulk of returns/repairs to deal with, even in the best of situations.
Shippers should be looking to beef up their reverse supply chain processes and making future predictions of demand – especially in December and January when post-holiday returns will peak. Partnering with networks of depots and warehouses can help you consolidate your returns, using methods like LTL or pooling, to help reduce return shipment costs.
6 – Limited scalability
If you’re already struggling to meet current demand, how are you supposed to grow your business? This is of particular concern for publicly traded companies, whose shareholders may demand growth no matter what.
The best supply chain optimization processes are future-focused and include scalability for future needs. They should also include as many alternate transportation options as possible so that demand spikes can still be handled without issues. Start building bridges with other transportation companies, or 3PL/4PL providers, so you always have options in place to support future growth.
US Logistics Supports Your Business Operations
US Logistics is one of the largest 3PL/4PL providers in the country, which is good news for you! Businesses can leverage our huge existing network – including 24 depots and over 15,000 stops per week – to improve the efficiency of their own shipments. We’re also management experts, capable of overhauling inefficient logistics systems to find across-the-board optimizations.
From growing small businesses to Fortune 500 operations, we have the skills and capacity to improve any shipping operation. To learn more, contact us and discuss your needs.