10 Logistics Challenges and Tips to Beat These Challenges in 2022

Nothing has truly impacted the global supply chain industry quite as the COVID-19 pandemic has done in the past few years. The pandemic, alongside, the rising trade tensions has led to a state of disruption like never seen or experienced before. The disruption of supply chains has further impacted the freight flow of all the major industries around the world, including automotive, electronics, pharmaceuticals, food, consumer goods, and even labor management.

With the pandemic exposing the vulnerability of the global logistics and supply chains – there are several challenges that logistic companies need to prepare to tackle in 2022, apart from offering digital freight tracking and supply chain management software solutions. We have shortlisted some of these threats and solutions for you to leverage upon. 

  1. Soaring Freight Rates: According to several surveys and the latest statistics, the freight rates have skyrocketed to 20%. Looking at the rising freight rates, logistic companies need to think of intuitive ways to cut costs at the supply chain end. Furthermore, by coordinating incoming orders, meeting dock times, and predicting traffic conditions through data analysis, it is possible to cut down these costs even further.
  2. Soaring Fuel Prices: High fuel prices worsen the situation even further as it directly impacts the whole transportation network. Furthermore, parallelly-impacting the logistics industry, causing serious delays in the supply chain and freight tracking estimates. 
  3. Lack of Labor & Inflation: There has been a huge shortage of skilled labor like truck drivers, container ship crews, and other delivery professionals due to Brexit and the pandemic. Elements like financial shortfalls, continuing social distancing regulations, and large financial funding from the government have also discouraged labor to get back to work. However, with pandemic relaxations happening across the globe this year, investing in skilled labor is one of the best moves global logistics businesses can make to protect their operations and profits as we move ahead in 2022 and beyond.
  4. Global Traffic Restrictions: As the pandemic crossed borders around the globe, international traffic restrictions and increased border controls led to disruptions in the supply chain, affecting logistics bookings across the globe. Staying well-informed and prepared in advance, companies can make informed decisions about route optimization to reduce the distance and the cost simultaneously. 
  5. Stringent Government Regulations: The unforeseen circumstances that the pandemic brought involved stringent government regulations across the world. The bureaucratic regulations have made it difficult to get logistics approval. Yet, businesses that prepare ahead of time and adapt their logistics as per these new regulations can always use it to their advantage.
  6. The Increasing Need for Sustainable Logistics Operations: The need for sustainability and movement towards eco-friendly products or methods has increased greatly in the last two years. Consumers are willing to pay more to support greener logistics operations as supply chains have the highest ecological footprint. To tackle this issue, logistics businesses need to find retailers and manufacturers that are more committed to eco-friendly and sustainable manufacturing.
  7. The Quick-Delivery Trend: Consumers are getting used to quick turnarounds and fast delivery speed. Service convenience impacts shopping behavior in many ways. Logistic companies can incorporate Micro Fulfilment (which involves using small decentralized warehouses to reach the consumers) or Automation – of the warehouses with robotics and artificial intelligence to speed up the operations.
  8. Poor Infrastructure: Owing to the lack of infrastructure, there are delays in deliveries. Industries worldwide should consider major investments in infrastructure and resources like better machinery, vehicles including planes, ships, trains, and management of ports, etc. to increase overall growth.
  9. Managing Increasingly Complex Networks: With complex networks come greater challenges. Stakeholders seeking to build agility and resilience in complex supply chains face struggles with transparency and need to find processes to make their network transparent, simple, and fair. 
  10. Unforeseen Supply Chain Risks: Logistics businesses need to consider unforeseen risks., and accordingly increase the supply chain flexibility to remain competitive. 

It is imperative that logistic challenges are here to stay and smart logistics businesses that are equipped and ready for an adaptive technology-focused approach will continue to grow regardless of how the pandemic has affected the logistics industry.

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