Inbound Logistics | January 2022

COVIDRECOVERY [ INSIGHT ]

by Josh Jungwirth EVP of Freight Forwarding, GEODIS in Americas marketing.americas@geodis.com | 1-866-4GEODIS

How to Combat Logistics Logjams . Nearly two years into the pandemic, today’s congestion issues and logistics logjams are not expected to end anytime soon. It is imperative brands fortify their supply chains to best navigate the current environment and prepare for what unexpected challenges may lie ahead to limit future disruptions. network constraints moving forward, shippers need to adopt a more diverse delivery strategy. For many, this means using multiple national parcel delivery carriers along with regional providers. This ensures

they have the capacity to get their products to the end consumer when needed to create a satisfactory purchas- ing experience. Additionally, we continue to experi- ence capacity challenges out of Asia. The pandemic reduced capacity at a much quicker rate than the reduction of trade demand, increasing freight costs and decreasing transit reliability. Ongoing port congestion is forcing many retailers to consider air transpor- tation. Because passenger belly space remains lower than pre-pandemic levels due to limited international travel, retail- ers are renting entire cargo aircrafts to help offset capacity issues. With this in mind, it is critical brands rethink delivery strategies. For many, this means shifting from a single-source supply chain to establishing multiple manufacturing centers with their own supply chains and delivery strategies in order to be more agile. By embracing an omnichannel mind- set, automation technologies and diverse delivery methods, brands will have the strategies in place to best navigate unex- pected logistics logjams in the future. n

To help combat ongoing industry labor issues, it will become imperative that brands make smart investments in automation. Automated fulllment solutions sup- port the demand for speed and accuracy. Automated technologies, such as put- to-light walls, sorters, conveyors and pack-and-apply machines, can offer faster and more efcient handling of units while reducing the demand on team- mates to perform highly repetitive tasks. The pandemic has underscored automation and robotics can pro- vide a defensive strategy to supply chain disruptions caused by the lack of labor availability. RETHINK DELIVERY STRATEGIES Many retailers were surprised by the capacity constraints in the parcel deliv- ery network at the onset of the pandemic created by the inux in online orders. In the past, the emphasis was on securing the lowest cost with the best incentives, typically through one parcel pro- vider. However, in order to best address

A burning question facing retailers is if and when customers will return to pur- chasing in stores similar to pre-pandemic patterns rather than buying nearly any- thing and everything online. Historically, many shippers have bifur- cated their buying decisions, supply chains and fulllment strategies based on sales channels, which generally provides a lower cost basis when done well. However, to thrive today, retailers must embrace omnichannel fulllment strategies. Looking ahead, omnichannel optimi- zation will be critical to current business models. Newly dened consumer behav- iors will meet and synthesize with various buying patterns. In some indus- tries and within certain demographics, e-commerce may retain its status as the primary buying channel. In some situa- tions, however, there will be a reversion to a combined model of traditional brick- and-mortar retail and e-commerce. It is crucial for retailers to be more agile to meet customer expectations within a variety of purchasing methods, whether online, a mobile phone app or in-store.

86 Inbound Logistics • January 2022