What lessons can logistics companies learn from 2020?
By Atul Bhatka, CEO, One World Express
If there is one good thing about 2020, it is this: businesses that survive it will be far better prepared for the future.
COVID-19 has done more to expose the shortcomings of businesses and global distribution networks than any other event in recent history. Added to this, logistics businesses have had to contend with the ongoing uncertainty surrounding the future trading relationship between the UK and European Union (EU), with no deal agreed and the Brexit transition period nearing its end.
Overcoming two massive obstacles – namely the operational burden of implementing new social distancing measures and the need for preparedness against Brexit – is no small feat. Particularly at a time when supply chains have had to meet high demand; PPE has had to travel around the world, while the pandemic has resulted in a spike in online shopping and, therefore, home deliveries.
From my perspective, the logistics sector has responded admirably. Firms have strived, successfully for the most part, to ensure goods can still get from A to B in spite of the challenges they have faced. And, as stated, the lessons they have learnt along the way ought to put them in a stronger position going forwards.
Communication is key
In times of market instability, there is nothing more important than communication. Whether with staff, partners or clients, logistics firms have had to keep people up to date on market developments and, more importantly, on how they as a business are responding to them.
Throughout this year I have seen logistics firms adopt this mentality via new digital HR and inventory solutions. Adopting software that allows decision makers to see which staff are assigned where and the capacity of any given firm’s supply chain has proven vital. This information allows management to eliminate inefficient processes and minimise the number of delays or obstacles that are encountered when shipping goods.
But not only can key information be learnt from within one’s company, but also throughout the entire logistics industry. A report from the Royal Academy of Engineering published in July illustrated numerous instances of firms supporting each other throughout the COVID-19 crisis.
One firm described in the report managed to link up a manufacturing client who was suffering from a lack of a key component with a supplier of that same component who had a surplus due to a diminished client base as a result of COVID-19. Such a win-win scenario was only possible because the logistics firm in question maintained strong relationships with other businesses and communicated between them.
This lesson is paramount for those who want to apply what the logistics industry has learnt in 2020 to the future. In an event like a pandemic, each individual and company will inevitably experience the crisis differently; so, it makes sense that there will be many instances in which companies can enter into mutually beneficial enterprises.
Do not be a passive player
As I already mentioned, logistics companies operational in the UK will likely have to re-organise their operations to ensure any disruption incurred by Brexit is minimised. And, despite the UK Government’s insistence that it is keen on securing a deal – the reality is that the UK will most likely be trading with the EU on WTO terms moving forward.
So, preparations must be taken. What these preparations look like will vary from business to business; some will establish new warehouses and offices in an EU country to ensure easy access to the Single Market, whereas other might pivot their sales strategy to focus on new regions entirely.
Whatever preparations are taken, communication will remain vital. It is up to logistics firms to demonstrate that they are not passive players – some firms may wish to take a ‘wait and see’ approach, but such an attitude risks unmanaged operational disruption when Brexit eventually arrives. As a result, the more preparation a firm engages in, the less chance of reputational damage when new tariffs, customs checks, and roadblocks are introduced after this year.
Ultimately, those able to apply the wisdom the logistics industry has demonstrated this year will be best prepared for the future. Though no-one can be sure when the next period of global market uncertainty will arrive, the one thing we can all be sure on is that it will come eventually. And businesses unable to learn from the mistakes made in 2020 will be doomed to repeat them, while those who replicate the agility and intelligence shown by many logistics firms this year ought to continue to thrive.
Atul Bhakta is CEO of One World Express (enabler of ecommerce and cross-border shipping worldwide – shipping solutions for emerchants, ecommerce service providers and marketplaces), a position he has held for over 20 years. He also holds senior titles with other retail companies, underlining his vast experience and expertise in the world of ecommerce, trade and business management.