Hundreds of trucks are queued at borders, your courier is stuck 200 miles away, production has stopped due to no supply of raw materials from China, and empty shelves at supermarkets – the last few weeks have made it clear how logistics and supply chain are essential for the well-being of the society.
The logistics sector makes up about 11% of global GDP, and, as the backbone of global trade, supports countless other industries. The impact and the reaction to the virus on supply chains and logistics appear to be spreading across the globe. India’s maritime industry, the backbone of the export-import trade, is seeking a relief package from the government to deal with a looming crisis as the coronavirus pandemic takes a toll on the global economy.
On the supply side, factories and businesses have been forced to close temporarily due to a shortage of supplies & the protection of workers and demand is declining as consumers are staying at home.
As a result, organizations need to respond to this pandemic by digitizing their logistics function, support the workforce, and sustain business operations. Using updated data sets and proper forecasting tools have become necessary to balance supply and demand.
But, organizations can in fact take this as an opportunity to completely revamp their logistics system and bring in more efficiency and effectiveness in their operations. Examples are Amazon’s vaccinated supply chain and Flipkart’s innovative measures.
Following are some of the measures that can be taken by leaders to rethink and renew the whole ecosystem of logistics-
- Real-time visibility:
Companies can improve the visibility in the logistics system by integrating the inventory levels, demand forecasts, suppliers’ conditions, warehouse capacities, and in-transit inventory on a real-time basis
- Cross-industry forums:
Companies from various industries can form a forum/committee for greater logistics collaboration to develop models for process and innovation.
- Renew your plans:
Businesses now have an opportunity to have a zero-based mindset, take a close look at the supply chain systems, start and devise a new plan from scratch. Basically, Renew & Rebuild a cost-effective system.
- Communicate effectively to all stakeholders:
Let your customers know that you have an alternative system of logistics in place.
Realign the workforce, support, and protect them.
Communicate with suppliers and together come up with alternative solutions to tackle supply disruption.
Support local communities, leverage your supply chain to help the delivery of essentials. This will also improve your brand image.
- Revisit Contracts:
Alter the terms and conditions in the contract with the suppliers, distributors, vendors, customers- according to the new normal.
Apart from this, businesses can take measures to create a responsible, trustable green logistics network taking environmental considerations in their supply chain ecosystem.
The Government is also stepping in-
The United Kingdom has recognized logistics personnel as “key workers”. This will allow them to continue accessing childcare and schooling for their children when they work. The Director-General of Civil Aviation (DGCA), India, has given a nod to food startups like Zomato, Swiggy, and Dunzo to start testing beyond the visual line of sight (BVLOS) drones for deliveries.
This pandemic will pass. The speed of the economic recovery would depend on the ability of companies to handle it now, find ways to avoid stagnation of growth, and generate revenue with the help of digitization and optimized processes.
Ergo, businesses should look at the future of logistics, embrace the new-normal, innovate, and adopt digital tools faster than ever.