David Salerno, director with 4flow, summarizes the top challenges that supply chains are facing today, and recommends how companies should be equipped to manage the resulting complexities. 

Supply chains have encountered several daunting challenges over the past few years, including global disruptions of product movements, rising fuel prices, carrier capacity shortages, unstable rates and the need to prioritize sustainability. 

The effects of COVID-19 might have abated, but there have been lasting effects to cope with. Consumer behavior has undergone permanent change, forcing manufacturers and shippers to do a better job of demand forecasting and transportation planning. In addition, logistics providers continue to grapple with labor shortages at key points along the supply chain.

Truck drivers, in particular, are becoming increasingly difficult to hire and retain. At the same time, carriers need to do a better job of utilizing existing assets and reducing inefficiencies in their networks. Five trucks might be arriving at a distribution facility, each less than a third full, Salerno says. That is necessitating a “mindshift” among transportation providers, who need to free up available capacity and invest in inventory to improve utilization. 

Planners need to approach optimization across multiple time horizons, beginning with the siting of distribution centers and extending to last-minute changes in response to shifting demand and consumer expectations. 

For shippers and logistics providers, Salerno says, the trick lies in being able to address the crisis of the moment at the same time they’re taking the long view and working on process improvement, strategic planning and digitization of network operations.