Transportation and logistics system has never faced an enemy bigger than the covid-19. The whole economy is in turmoil due to the coronavirus pandemic. Covid -19 has put an enormous amount of strain on the transportation and logistics resources. Huge reduction in international trade, manufacturing and commerce has a ripple effect in the transportation and logistics industry, which leads to an imbalance in supply and demand for the transportation companies.Read More
Some of the areas are worst hit by the global pandemic as compared with the rest of the areas. These hot spots of the global pandemic are also the one that has the most demand coming from. Therefore, all the transportation and logistics companies’ focus has recently changed to those areas. This has led to the longer waiting period of delivery, higher operating cost, health and safety related risks. Transportation and logistics industry is already facing a shortage of labour but covid-19 has only made it worse.
Life science and consumer goods companies are witnessing an unplanned growth while others are contemplating how to survive these tough times.
Covid-19 Impact on Transportation and Logistics
Transportation and logistics operations are conducted by sea route, land route and the air route. Each method of transportation is severely affected by the coronavirus.
Due to the worldwide spread of the coronavirus, shipping containers are stuck at the docking yards and the volume of container movement dropped by a considerable amount. More and more shipping lanes are closed due to borders closed by the majority of the countries.
Land transportation remains partially opened during these tough times. Globally, the roads remain in operation except the countries with strict lockdown. Trucking services remained in high demand resulting in higher highway use tax and longer delivery time periods.
A lot of major countries grounded their air fleet due to the pandemic resulting in loss of air freight volume by one fifth of the original. Shippers have moved to the air cargo for the essential goods which also results in the increased delays and airport congestion.
The Pessimist Sees Difficulty In Every Opportunity. The Optimist Sees Opportunity In Every Difficulty. – Winston Churchill
Now the worst is over for most of the countries and the economy slowly starting to pick up the pace again. But for the transportation and logistics industry, it remains a huge challenge to go back to an efficient supply chain. Navigating through the impact of covid-19, transportation and logistics industry figure out that you need to be prepared for any type of situation. Supply chain industries need to come up with an excellent risk management and continuity strategy.
Impact on Small Players
Small transportation and logistics companies are being critically hit by the covid-19. Small companies usually don’t have any type of backup or recovery plan. Lack of resources, technology and tools to follow the proper health guidelines also complicate their response.
Major Players Also Faces the Blunt of Covid-19
Big companies also get severely hit due to the worldwide spread of coronavirus. Most of the governments around the world declared ports, shipping and trucking services essentials. This has a tremendous effect on the business of most of the big players of transportation and logistics companies.
Strengthening Mutual Relationships
With transportation management solution logistics companies need to strengthen and develop their relationships with the suppliers. Clear insight of the supply chain will help the transportation companies to be more flexible, agile and strategic. Flexibility and agility provides you the opportunity to gain on the marketplace due to chaotic times like covid-19. A well thought out risk management program will help the transportation companies to gain a clear insight of the larger supply chain issues.
Data Management for Better Future
By facing an unprecedented global pandemic covid-19, you will have big data at your fingertips to go through. You can utilize this data to reassess your future strategies and how to deal with these global catastrophic events like covid-19 and be better prepared next time if something like this comes back again.
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Retention of Your Current Customers
Covid-19 may be a blessing in disguise if you are able to utilize it to the fullest. You can use this pandemic as an opportunity to focus on your current customers and offer them the best of the best customer service. By carefully hearing each and every requirement of your customer, you are providing your company a second chance to thrive in future again.
Consider Mergers and Acquisitions
Transportation and logistics companies in a post covid-19 era have to seriously consider mergers and acquisitions as a way forward for better growth. This will double the capacity of the transportation companies and also make them strong enough to face the future adversary like covid-19.
Better Cash Management
Transportation and logistics companies need to properly understand their short term liquidity requirements and the long term cash flow goals. Keep evaluating your suppliers for more favourable terms and conditions for better discounts.
Response to the Coronavirus
A lot of companies have come up with new health and safety protocols to safeguard their employees from the global pandemic. Social distancing, disinfecting work areas and providing protective gears while offering them unlimited time off without salary are few of the measures taken by the transportation companies.
Recovery from this global pandemic related recession will take time and require a lot of hard work and patience. Transportation and logistics are very essentials for the world to move forward and will emerge victorious against all odds in this global crisis time.