The transportation sector is facing significant obstacles due to the economic devastation brought on by the COVID-19 pandemic. In response, companies around the world must adopt new strategies to limit supply chain disruptions.
The U.S. is currently experiencing a surge of imports, creating major headaches for ports across the country. Valuable space meant for full shipments is being taken up by empty containers. Simultaneously, as ships loaded with much-needed goods wait in line to unload, they're left stranded inside and outside of ports. Also, the inability of fully loaded cargo ships to offload their inventories has left port workers and truck drivers without shipments, generating longer wait times as well as higher costs.
Shipping companies now keep up with customer demands and avoid getting stuck with a mountain of backlogged cargo. One solution is implementing short-term leases at off-site locations, which could free up valuable space while accelerating the movement of empty containers.
In addition, some businesses have considered partnering with trucking companies as a way to retrieve containers directly from designated off-terminal yards, alleviating port congestion and keeping cargo flowing smoothly.
Organizations have begun relying on alternative shipping routes to keep the flow of goods moving. While it may be more expensive to move goods to and from these ports, re-routing can be a cost-effective solution when compared with the delays that arise from trying to access clogged marine terminals.
Businesses could also benefit from the deployment of new supply chain technologies. A lack of visibility into cargo in transit adds to port congestion and equipment shortages. Applications such as cargo-tracking systems can provide real-time visibility into the location of containers, when they will arrive, and how many are needed to fill a shipment. Furthermore, access to detailed shipping data can ensure that containers are loaded and unloaded as quickly and efficiently as possible.
By dedicating more time and resources to properly forecasting and planning demand, organizations can become less reliant on the most congested ports. Shippers, meanwhile, need to make sure they sufficient inventory on hand to meet customer orders without the need for just-in-time deliveries or last-minute shipments. They should also coordinate with suppliers to confirm they have enough containers to meet their needs.
Backup plans are necessary when dealing with port congestion and container shortages. Organizations should develop alternative shipping routes, lease off-site storage facilities and partner with trucking companies to quickly retrieve containers. In the process, they can sidestep any obstacles that might arise, and keep delays to a minimum.
Companies should also consider turning to logistics partners to help them identify potential shipping and cargo solutions. Third-party logistics providers possess a wealth of knowledge about ports and shipping operations, and can aid shippers in navigating through this crisis. They can also provide insights into how other businesses handle disruptions.
Current port congestion and container shortage issues will require significant time, effort and coordination to resolve. But by taking the proper steps and working together, ports, carriers and shippers can emerge from this crisis stronger than ever before.
David L. Buss is chief executive officer of DB Schenker USA.
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