As the year passes, we see a drastic change in running a business. To stay alert and on top of the list, logistic challenges and trends are essential to be faced. We have seen the global pandemic flushing out the smaller businesses, making us realise the need for digital transformation.
Top Supply Chain Challenges for 2022
Ongoing labour shortages
The reduced number of skilled labour is a major global logistic challenge in 2022. After the pandemic, many qualified employees have changed in the overall logistics and transportation industry or their profile. To keep them tagged along with us, various measures and technological advancements can benefit the business in the long run. Some of these include digitalization and making the platform more user-friendly.
Low industrial real estate capacity
The major challenge in the logistics industry is low industrial real estate capacity. Storing and managing the goods can impact the business positively. Therefore, enterprises opt for high industrial warehouses that can store bulk materials that increase the demand in the supply chain by order fulfilment, distribution and more.
The future of the logistics industry is automation adoption. With the advancement of technologies, it is vital to incorporate automation, which reduces labour costs and saves a lot of money. Core process optimization can be enhanced by automation which reduces the manual task operations and effectively manages the work on time. Automation reduces the dependability on the man forces and thus streamlines processes within the supply chain operations.
More supply chain bottlenecks
A slowed paced manufacturing hinders the rise in business. The congestion point in the production causes bottlenecks in the supply chain. It is caused due to less skilled labour, over-work production, or oversupply or demand at once that concerns the operating system and workflow management. The supply chain demands proper management and following of business from start to end.
Logistics challenges have tended to rise over the past two years. First, the pandemic washed away the well-established supply chain market and then the Russia – Ukraine war. This war disrupted many supply chains and imposed various sanctions. Due to the restrictions and embargoes, different natural gas and crude oil resources become vulnerable, increasing their demand.
Rising freight movement cost
Transportation and logistics challenges have increased as more and more businesses have shut down during the pandemic times. It led to home-sick workers and increased rates of deliverables. Cargo delivery from one point to another costs a certain amount of charge, which has shown a drastic increase from 2020 to 2022. Climbing oil prices and shipping charges have led to rising freight movement costs in 2022.
After encountering the perilous coronavirus pandemic, the charges for even the smallest material have increased. Though technology has become more digital and advanced, the inflation rates have touched the sky. The supply chain market has also witnessed the same rise in almost every sector with rising prices of goods. Once the cost of the goods increases, it keeps increasing from the previous year. Many goods were unavailable because of the pandemic, which exponentially increased their demand and led to inflation.
Demand forecasting struggles
As the market increases, the demand for the supply has also increased dramatically. But how are we sure to measure the best time for that deal? How do we ensure the correct strategy and powerful moves to stay ahead of the game? This is where the forecasting comes into the scene. The pandemic drove global citizens’ demand for innovative ways to filter out forecasting behaviours. By assimilating tech-fueled analysis, demand forecasting can be enhanced efficiently.
Top supply chain trends for 2022
Digitalization builds transparency and enables quicker decisions based on real-time insights. With artificial intelligence and data analytics, we can enhance visibility and ensure an end-to-end overview of the supply chain with increased digitalization. It has helped transform the existing supply chain structures into flexible and open digital models.
BOXXPORT containers encourage the transformation from traditional to digital business. One can manage their complete fleet with our cloud-based business solutions.
To reduce carbon emissions and maintain sustainability, many companies apply low-energy production of goods, drastically decreasing pollution. But the same companies lag in sustainable measures when they supply the same interests by forgetting about the supply chain pollution that is more than producing their actual goods. This is an area where companies should reduce the climatic effects by ensuring eco-friendly measures.
Striving for a sustainable environment is nevertheless a wrong thought. As we face significant difficulties during the pandemic, our nature has tackled even more than that. Global warming and pollution have increased so much that it seems complicated to put them back into place. What we can do is, adopt sustainable measures to reduce the damage that has already been caused. The supply chain market can reduce this crisis by imbibing reduced fuel consumption throughout the process. It can be achieved by optimizing the last mile delivery.
Driver retention focus
We often neglect the primary resources that play a vital role in the entire business. With each rising year, increasing inflation affects everyone on this planet. This brings us to the driver and their retention. Drivers are often given low wages based on hourly pay or distance pay. This has demotivated the drivers leading to resignation from the job.
Challenges faced by logistics industry during COVID-19
Hardly trucks and their drivers obtain what they deserve. To tackle this emerging issue after the COVID-19 pandemic, drivers should be paid on delivery which motivates them to take the next order efficiently with great enthusiasm.
Supply chain localization
The next big jump that companies should take is to localize the supply chain. It increases the business and also reduces costs. Any customer would demand fast delivery, which can be achieved through localization.
Carbon footprint reduction
Supply chains are more prone to enormous scale destruction to the environment as they utilize extensive resources. To reduce carbon footprint, organizations must accumulate measures and exhibit the environmental duty. Companies should focus on reducing the pollution that is caused due to significant resources and rectify or find innovative and eco-friendly ways to solve it. By following these, we can reduce our carbon footprint to a large extent.
IMO (International Maritime Organization) 2020 norms also suggested the reduced usage of sulphur in the fuels. This will save the environment and human life from various diseases.
The use of heavy oil leads to a higher amount of pollution. The use of low-emission fuel reduces the dependability of generic powers and increases efficiency by reducing waste. When we say every drop matters, it is true; even a simple step of reducing, reusing and recycling can bring about a significant change.
Most of the goods we obtain are supplied through sea routes that require a heavy dose of fuel. The fuel used leaves residue and causes air pollution by releasing harmful gases and pollutants in the air and water. This affects our nature exceedingly. Acid rain and lung-penetrating particulate matter cause the most problematic effect on all living organisms. Therefore, companies should cap the emission of sulphur and nitrogen oxide.
Middle and last-mile optimization
Logistics industry trends provide cutting-edge opportunities in middle and last-mile delivery. The middle mile is the local delivery from the port to the warehouses which offers good margins over the last mile deliveries. Middle mile is cost-effective and uses technologies to track the capabilities of the store and the trucks.
Unlike the middle mile, last-mile delivery is quite expensive and time-consuming. It demands to lower the delivery charges, which effectively hamper the profit that can be made through it.
By using intelligent AI technology and eliminating human efforts, we can gain power over the loss and ultimately turn the business profitable.
Cloud provides flexibility to store and manage data online. It can help to interconnect the data with data transparency throughout different levels. As pandemic hits various businesses, data privacy and cloud integration have become a must to stay ahead of the technology. It boosts the industry by providing speed and visibility, which allows for better and more informed decision making.
A transport management system enhances transportation across a network. It is essential to optimize cross border logistics to ensure a seamless flow of goods across borders. As consumers’ demand for goods has increased within the last two years, the area of delivery and expansion has significantly increased. The most effective transport and logistics industry trends in 2022 would be more expansive and expanded transportation networks to fulfil this very requirement.
To strive for effective solutions for the challenges and trends of 2022, BOXXPORT has made the business easier from local to global transport. Now, you can manage and connect your entire fleet digitally with BOXXPORT cloud-based business solution. This container service industry provides an opportunity for the digitalization of logistics and knows the whereabouts of the global market by cutting edge technological integrations.