Our Top 3 Global Shipping Lessons Learned from COVID-19

The Covid-19 pandemic exposed weaknesses in global shipping and supply chain practices. Even with subtle hints and warnings from past events and analyses, industries and society as a whole were not prepared for the very real and dramatic impact of a global pandemic. For instance, a report from 2016 found that 40 percent of US states lacked enough backup medical supplies for coping with a pandemic. And, 4 years later, it is evident that very little changed.

As some regions around the world begin to move past the initial phase of the pandemic, leadership teams and business owners are taking a hard look at their supply chain. Antiquated global shipping strategies and minimal inventory practices are now leaving businesses vulnerable. It is vital that companies take a look at lessons learned to increase their agility in the face of future disruptive events.

Here are our top 3 lessons learned from Covid-19:

Lesson 1: Have inventory on hand

In recent years, many businesses have been lauding the benefits of just-in-time (JIT) inventory principles. The JIT model calls for lean inventory that depends on tight connections with suppliers. The goal is to lower the cost of manufacturing, shipping and warehousing. When the JIT model works it can create substantial savings, but it can also make the company extremely vulnerable to unexpected disruptions. As the result of Covid-19, the healthcare supply chain became a blaring example of how a major interruption can cripple a company that depends on lean logistics models.

In a trend that began during the trade wars and Brexit, more companies are beginning to increase their inventory in an effort to mitigate risk. Now with the uncertainty of the current pandemic, there has been a sharp increase in the demand for warehousing services and a reversal of the lean logistics model.

In 2019, Mach 1 Global Services expanded its warehouse facility in Atlanta, GA in response to the growing demand. As a 3PL, we can offer customized warehousing solutions to meet the specific needs of our clients as they reevaluate their supply chain strategy.

 

Lesson 2: Increase resilience with alternative global shipping strategies 

With commercial flights grounded, companies that relied on air freight were left scrambling to secure space on a limited number of cargo flights. Seemingly overnight, shippers found their cargo bumped, delayed or being charged unpredictable, inflated rates. Without an alternative shipping strategy, companies were caught off-guard.

This has spurred the growth of combined shipping methods, such as using sea/air or sea/trucking. Working with a freight forwarder, this strategy uses multiple methods of transporting a single shipment of cargo under a single bill of lading. Not only can this tactic provide a solution to inflated air freight rates, but can also offer quick delivery times when taking into account the limited capacity of air freight and congested sea ports. It is likely that shippers are not aware of these options as they were not necessary before the pandemic.

Today, companies that formerly relied on air freight alone are now seeing considerable benefits in using a combination of fast ships and trucking or ocean and air transport. These freight tactics are time and cost efficient. Shippers worldwide are finding that it is wise to have an alternative transportation strategy as a backup plan for use now or in the future.

 

Lesson 3: Relationships are everything in global shipping

With over 30 years in the global shipping industry and offices around the world, we have established industry relationships that allow us to better serve our clients. When Covid-19 began to spread across the globe, we had up-to-date information from charter airline companies and ports. We relied heavily on our long-standing industry relationships to ensure that our customers’ shipments were transported with the least interruption and for the best possible price.

At the onset of the pandemic, our network allowed us to help a client with a shipment stuck in China. They were unable to get an update from the carrier service they were originally using. We used our relationships to secure a flight for this client and get the shipment moved.

In another example, when air freight rates soared fast ships became the go-to alternative method. This created competition for space on their vessels. Our clients were guaranteed available space based on our many years of doing business with fast ship companies. Our clients’ shipments weren’t delayed proving that relationships really are everything when it comes to global shipping.

Ready for a post-covid-19 shipping and inventory strategy?

Mach 1 Global Services is a freight forwarder that has the experience and industry relationships to guide clients through this unprecedented time. We can help you adapt your supply chain to meet the new challenges of the post-Covid-19 era. To learn more about our global shipping services, visit our website. To discuss how Mach 1 Global can assist you call (800) 553-7774 or get a quote by clicking HERE.

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