Sustainability, staff shortages and Brexit. Those were the main challenges for the logistics sector in 2018 and 2019. But what about this year? In this blog, we discuss three of the greatest risks for logistics companies in 2020 and 2021.
While the Brexit deadline is still lurking, its relevance has been weakened by the uncertainty surrounding how the Brexit will take place and by the corona crisis. However, the relevance of this topic is sure to pick up again, and it is always good for companies to keep preparing for it. You can read more about this in our earlier blogs. For example, transportation companies have to take into account longer wait times at customs and extra customs formalities that can lead to higher transport costs.
1. Staff shortages
Shortages in available personnel are a well-known problem in logistics that the sector has been struggling with for a number of years. The corona crisis has brought job insecurity for many, but the number of available workers is also limited. More and more people are starting to work in transport and logistics, but the market remains strained.
The effects of this can be significant, not only for the growth within the sector, but also for the rest of the economy. Insufficient transport options could for example influence the availability and supply of products. The retraining of existing workers, among other things, can be a solution to this, but companies themselves can also take steps to combat this problem. Think of offering crash courses, career opportunities and more challenging work. Running recruitment campaigns can also contribute to reducing the staff shortage.
2. Unpredictability of customers
The unpredictability of customers refers to the number and the consistency of customers. Partly because of the corona crisis, this unpredictability has increased. The amount of work can fluctuate greatly, and the customer needs also vary as a result. This requires companies to be flexible, in materials and personnel. This flexibility is necessary because the type of tasks and the workload can vary greatly, among other things.
Incidentally, the increase in flexibility within companies is a form of “Agile logistics”, a trend that is increasingly emerging in logistics. Companies with “Agile supply chains” more capable in dealing with rapidly changing circumstances, for example due to economic or technological changes. Flexible supply chains also allow companies to quickly make adjustments to the marketing and sales processes. You can read more about trends in logistics in our blog.
3. Focus on improvements
The last of the three risks is something that many logistics companies struggle with. Namely, the focus on improvement, or the lack thereof. Companies sometimes have little to no insight into the developments and innovation opportunities that are necessary to grow or to continue to compete in a competitive market. There is often no room, focus or budget for implementing improvements. This is a shame, as more and more smart, digital and automated solutions are coming onto the market that allow companies to work faster, solve problems and reduce costs.
Automation and digitization are inevitable and play a vital role for companies when they want to optimize. For example, software that allows companies manage packaging and RTI’s or improve other business processes. It is therefore important to periodically discuss innovation and points of improvement, so that companies can keep up and compete. Read more about this in our blog “5 steps to driving efficient digital logistics“.
Would you like to know more about the optimization of logistics processes and the risks companies face? Get in touch with us!