Strategic partnerships are key to meeting the many challenges the pandemic poses to the supply chain, says Ed Bowersox, chief executive officer of CJ Logistics.
As companies prepare budgets for 2022, Bowersox says it’s important to recognize that partners’ and customers’ pain points differ. “Whether it's inventory deployment nodes, transportation, labor, whether it's salary strategies, it's important to get aligned with our customers and strategic partners, to really understand each other and then put together plans to de-risk our supply chains.”
Bowersox has no illusions about the immensity of the task, especially since the pandemic has disrupted every node in the supply chain and face-to-face meetings are still out of the question for most people. But, he insists, this is the time “to set contingency plans and understand each customer’s supply chain from the standpoint of their raw materials, their products and what we can do to decouple some of the congestion, add value in certain hotspots, and understand problematic areas.”
It’s essential that in-house talent understands the strategic imperatives that are important to customers and partners. “Are they educated on the situation? Do they understand driver constraints, labor constraints, wage pressures, inflationary costs due to fuel or other input costs into the supply chain? How well can they align with your strategy, then collectively work on solutions to avoid or mitigate those issues and be competitive in the market space?”
Inventory is a major pain point for many companies in these uncertain times. “So many are having a difficult time forecasting their business,” Bowersox says. “A lot of them have been caught in kind of a whipsaw effect of inventory. They had leaned out inventory. Now they're in overflow mode.” There may be several ways to remedy the situation, he adds, but it starts with listening to customers describe their pain points.
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