The U.S. supply chain management system has never been more important than right now.
Before we delve in, my name is Chris Cashin, and I decided to start writing in Forbes to share some of the key pieces of information vital to the current situation that I’ve learned over the past decade as a shipping and logistics industry insider.
In the mid-2000s, I trained to become a USMC 5711 Marine Corps Defense Specialist (CBRN), before cross-training as MOS 6672 Aviation Supply Specialist. This gave me a foundational understanding of how the government and public might respond to a global pandemic, as well as the basics of working in a supply chain environment. My combined experience in these two fields and my present experience as CEO of a shipping and logistics company makes this pandemic even more personal to me.
U.S. Supply Chains Are Running (Sluggishly)
The simple truth is that U.S. supply chains are running, but they’re sluggish because they’ve lost staff while seeing quick and substantial increases in demand and need.
Most supply chains work reactively, meaning that if everything is working, there’s no reason to fix it. That is, until nationwide essential supply demands have taken hold, and then the reactive process gets underway.
The slowdown isn’t because we’re out of essential goods, food or any other type of product you’d order online or buy at your local grocery store. We’re seeing a reactive supply chain sluggishly navigate its circumspect in an unprecedented avalanche of demand. This results in supply lines being stretched thin, increased demand and more trucks running on the road.
Major Carriers Are Adjusting (Quickly)
Shipping carriers are reacting and adjusting by adding more workers and increasing their fleet capacities. Deliveries, for the most part, are on course and in motion.
- The USPS has stated they’re not having any impact on operations whatsoever, excluding certain international shipping destinations.
- FedEx and UPS have continued operations as usual and are well prepared for sudden influxes in shipping due to e-commerce holidays like Black Friday and Cyber Monday.
- The Transportation Department’s Federal Motor Carrier withdrew several restrictions on drivers, namely how long they can drive in a typical day before having to rest, to ensure that supply chains are even more agile moving forward.
- There are predictions that shipping volume for major carriers and others will slow down as people have stocked up and the demand for luxury or even slightly less-than-essential goods lightens up.
What can you do to keep your company’s supply chain and shipping/logistics network chugging along?
Here are five tips I can offer you.
1. Rethink Your Supply Chain
As of mid-March, more than 94% of supply chains had experienced some disruption. So, there’s a good chance yours has been affected as well — but only to a certain extent. By exploring options with other new carriers, delivery services and fulfillment centers, you should be able to find a speedy remedy or backup capacity, even if it’s just a short-term Band-Aid.
2. Expand Supplier And Vendor Options
By rethinking the methods you’re using for supplies, your vendors and their geo-proximity to your warehouses and fulfillment centers, you can stay on top of the curve. As overseas suppliers ramp up inbound shipments, there are likely several alternatives you can explore that are cost-effective and feasible. In the interim, this may require some digging and negotiating on your part to secure new supply chain options.
3. Consider Using New Technology
There’s a chance that your technology is limiting your ability to manage key elements of your shipping, supply chain and infrastructure. Dated shipping software, for example, may not be as flexible with rates and/or multiple carrier options and could limit your ability to ship locally, regionally or via connected warehouse/fulfillment hubs that can improve your efficiency and accuracy and lower shipping costs at the same time. Rethink the technology you’re using, and integrate an approach that helps you deliver to more people on time.
4. Audit Your Shipping Rates
Having been involved in shipping, logistics, supply chain management and e-commerce for the better part of the past 15 years, I can tell you flat out: You should audit your shipping rates a few times per year. This is especially true when budgets are constrained, a supply chain is finicky and on-time fulfillment ratios are harder to attain. By doing some research and reaching out to different shipping partners, you can drastically reduce your overhead cost. Doing so will allow you to add another unique value proposition to your customers.
5. Be Honest With Your Customers
It’s a tough world out there for everyone right now. If you want to retain the loyal customer base you’ve spent years earning, honesty is the best first step. Ensure that delivery times are accurate and that you post out-of-stocks right away, especially on essential items. Make certain your customers know that you run a clean, safe facility and consider publishing a live blog or article on your site that keeps them informed of the extra precautions you are taking.
During unprecedented times like these, we all need to step up. Unity is what brings us together as a society and as human beings. This also means that the e-commerce industry is the mainstay for the majority of people while we adjust to some new ways of doing business and living our lives. The right strategy in these challenging times can have a positive impact that helps your customers, employees and partners — and your bottom line.