Supply Chain Disruptions: A New Normal in 2025?
As the holiday season approaches, companies are bracing themselves for another year of supply chain disruptions. Labor battles, which have been a prominent feature of trade disruptions this year, are expected to continue into 2025. The recent Amazon warehouse strikes, organized by Teamsters union members, are just the latest example of the labor unrest that is affecting global shipping.
A Perfect Storm of Disruptions
The strikes come just weeks ahead of a possible strike by dock workers at 36 ports along the U.S. East and Gulf Coast. This could lead to a perfect storm of disruptions, with industries like automotive and pharmaceuticals, which rely on just-in-time inventory models, being particularly vulnerable. “We’re already helping shippers prepare for a potential U.S. port strike in January,” said Mike Short, president of global forwarding at C.H. Robinson.
Contingency Planning is Key
To mitigate the impact of these disruptions, companies need to have contingency plans in place. This includes implementing alternative logistics strategies, such as rerouting cargo or using different modes of transportation. “Industries need to be prepared for any further labor unrest on the horizon in 2025,” Short warned.
Technology to the Rescue
In recent years, the logistics industry has become familiar with “black swan” events, such as the COVID-19 pandemic, which brought global supply chains to a halt. However, the lessons learned during the pandemic have led to the development of new digital solutions for companies to track trade and solve for the lack of communication and data sharing that contributed to massive congestion at ports. One such solution is the Freight Logistics Optimization Works (FLOW) platform, created by the U.S. Department of Transportation.
FLOW: A Game-Changer for Supply Chain Management
FLOW is a digital platform that allows companies to track trade and identify trends, strengths, and weaknesses in the U.S. supply chain and infrastructure. Since its inception, 86 partners, including retailers, freight carriers, logistics providers, port operators, and trade associations, have been sharing data to provide a more holistic view of trade. Today, 75% of all U.S. container imports and 80% of U.S. container terminal capacity are tracked by FLOW.
Real-Time Data for Better Decision-Making
The platform provides real-time data, which enables participants to have a snapshot of port and inland network congestion and monitor unexpected cargo shifts caused by disasters or world events. This data can be used to make better decisions, such as repositioning inventories or shifting cargo to avoid congestion. “You can look at it as a kind of disruption response tool, or as a black swan event response,” said Andrew Petrisin, Deputy Assistant Secretary for Multimodal Freight at the U.S. Department of Transportation.
A Brighter Future for Supply Chain Management
While the future of supply chain management may seem uncertain, the development of digital solutions like FLOW offers a glimmer of hope. By providing real-time data and enabling better decision-making, these solutions can help companies navigate the complex and ever-changing landscape of global trade. As Petrisin said, “I think a lot of the lessons we learned from the West Coast [port congestion during COVID] was how do you manage this interdependency in the way that allows for fluidity and allows for resilience when there are disruptions?”
Leave a Reply