Global Trade Networks Bring Certainty to Uncertain Times
There is no magic bullet to overcome the capacity crunch. The supply chain has proven to be the competitive battleground of the future, and organizations that act proactively by implementing a flexible, adaptable supply chain solution will be the ones in the best position.
Weather-related events and other inevitable tragedies have taken a tight market and applied a vice grip to it. The supply chain industry has been forced to respond to several natural disasters that have led to closed ports and roadblocks. While recovery efforts continue, the aftermath is still felt across the United States.
Government-mandated Electronic Logging Devices (ELD) for commercial trucks are also having a significant impact on transportation rates and capacity. The total impact is still unknown, but many analysts believe it could have a four- to seven-percent impact on capacity and a five- to 15-percent impact on carrier rates.
Network for Capacity
Operating on a static, closed, on-premise transportation solution doesn’t allow flexibility to adapt to sudden disasters and mandates. The first step to overcome difficulties is to join a global trade network. The power of a network lies in its ability to bring clarity and certainty to a volatile situation, while offering on-demand connections to thousands of potential carriers.
Forming connections, streamlining processes, and identifying new capacity can be accomplished quickly. Joining the right network will provide the following benefits and strengthen an organization’s supply chain solution:
- A global capability. The use of a more resilient network will allow a business to sell across borders and trade zones like it’s right next door. Systems can be updated easily as new customs requirements are put into effect.
- Value flexibility above the certainty of the status quo. Supply chain managers cannot afford to sit still with static supply chains and think they’re prepared. Making the extra effort to prepare for multiple scenarios leads to satisfied customers in times of trouble.
- Provide supply/demand insight. Market data, combined with a deep network, can help secure the best rates and protect an organization’s budget. For example, with a global trade network view of the market, Logistics-as-a-Service customers have the potential to keep rates lower than with a limited view of providers.
- Seek best-practice solutions. These solutions provide the capability to capture and identify successful new processes, ideas, and technologies so they can be learned and implemented based on proven results. Once identified, they can be deployed faster than the competition.
The capacity problem isn’t going away anytime soon. Supply chains may get some relief when the impact from the storm recedes, but it will still be a growing issue.
Joining a global trade network is the foundation for flexibility and operational creativity. Moving from static old systems and processes, and embracing a network model, will help organizations find and access new capacity faster than ever.