How Supply Chain Operations are Being Disrupted Due to COVID-19
Sep 15, 2020

Since March, our world has transformed into something we barely recognize.

Classrooms, sports stadiums, and movie theatres sit empty. Restaurants have chairs stacked on top of tables. We wheel grocery carts down aisles filled with mask-covered faces, rolling past empty shelves.

One of the many things COVID-19 has disrupted in our world is our supply chain operations. Read on to learn more about how the supply chain has been impacted, specifically how trucking and freight industries have been impacted and what companies can do to keep things moving.

 

How the Supply Chain is Being Disrupted

Recently, manufacturing experts have gotten the supply chain down to a science. They know how much each area is going to order of a certain product, and they know when they’re going to need more.

Manufacturers produce very little in the way of surplus goods. Everything runs on a very tight schedule with little waste.

But recently, stores have been ordering more than usual on a more rapid schedule. Warehouses are out of their usual supply and are asking for more from manufacturers. But manufacturers are falling behind schedule, and everything is getting deadlocked.

 

Why the Supply Chain is Being Disrupted 

When the COVID-19 pandemic set in, many people went and bulk-purchased a variety of goods. Toilet paper, canned goods, and cleaning supplies were on the top of everyone’s lists. This emptied grocery stores, who, in turn, emptied warehouses.

As demand for products was increasing, manufacturing was slowing down. All non-essential businesses were put on hold during the initial shutdown. Many plants were repurposed to make ventilators and PPE for healthcare workers.

When normal manufacturing did start back up, many companies have continued to have a smaller workforce due to people being out sick.

 

How Deliveries Are Impacted

The retail world isn’t the only industry being impacted by the disrupted supply chain. Delivery services are also suffering from the short supplies and decreased manpower. But they’re also experiencing increased service demands.

Since everyone has been trying to stay at home more, they’ve been ordering more products online. Shipping companies may be taking extra precautions that slow the delivery process. And a smaller workforce means it’s taking longer to get packages out to customers.

 

How Trucking is Impacted 

The trucking and freight industry is also suffering thanks to the heavier demand and lower supply dynamic. Many trucking companies are experiencing employee shortages thanks to COVID-related illnesses. Recent USPS policy changes have slowed down the shipping process exponentially.

Many delivery drivers have also had to struggle to avoid getting behind on their routes. Fewer on-site workers at their drop-off and pickup locations mean longer wait times. This puts them behind schedule.

Drivers have had to contend with restaurant and restroom closures. This may leave them unable to get the breaks they need on long routes.

 

Keeping the Supply Line Moving

In the short-term, the most important thing companies can do is to keep the supply line moving. Companies need to provide their employees with masks and hand sanitizer. They should also promote flexible working arrangements and prepare for increased absenteeism.

Trucking companies need to plan routes that allow drivers to rest, eat, and use the restrooms. If possible, increase coordination efforts with drop-off and pickup locations using creative technology like GPS locators and live map updates. And you should perform regular COVID tests for drivers working in hotspot areas.

 

Reducing Liability 

In some cases, your business may find itself liable for delays in the supply and shipping process that are outside your control. The 30-Day Rule states that a business must ship a customer the goods they ordered within thirty days or offer them a full refund. But with the supply chain in shambles, what do you do if a product is on backorder for some time?

Talk to your company’s insurance agency and ask about what sort of liability coverage you have. Often insurance policies will help to reduce your liability for these incidents, especially in the midst of a pandemic. Make sure you document every piece of your order, supply, and shipping process so your insurance agent can assess your claim.

 

Establishing a Digital Supply Network

The COVID-19 pandemic has made it more evident than ever that we need to move from a traditional supply chain to a digital supply network. In a traditional supply chain, a product moves from development to planning to material sourcing to manufacturing to delivery to ongoing support. If one piece of this chain gets disrupted, it throws the whole thing off.

In a digital supply network, every piece is supported by all the other components. Everything is built around a digital core, which helps to power synchronized planning, digital development, intelligent supply, factories of the future, dynamic fulfilment, and connected customers. This network can adapt and respond in real-time to market demands, making it easier to keep things running smoothly. 

 

Adapt Your Supply Chain Operations

COVID-19 has changed everything about how our world runs, from the way we conduct our businesses to our supply chain operations. If you’re struggling to keep things moving smoothly, focus first on keeping the supply chain moving and reducing liability. Then consider establishing a digital supply network once you’ve been able to get things back under control. 

If you’d like help protecting your business, check out the rest of our site at Gallagher Basset. We specialize in guiding you, guarding your business, and going beyond in making sure you’re protected. Contact us today to learn more about GB Transportation and start creating a more secure work environment for your company.

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