At this very moment, billions of dollars’ worth of goods and products are sitting on ships just waiting to be delivered. Some of these materials are needed in factories to complete the final product, while others are holding up sales in stores and for online retailers. The result is a strain on the supply chain that is driving prices up for vendors and customers alike.
At every point of the supply chain, companies are discovering delays that drastically impact their business. Congestion at ports, the search for shipping containers, struggles to find space on trucks and trains—even the last mile for deliveries is hurting due to labor shortages. Buyers and suppliers must extend payment terms and obtain new financing to cover the costs of late and missing inventory, and those rising costs are passed to the customer.
Looking Back
Before the pandemic, back in 2019, 78% of container ships arrived on time, according to Sea-Intelligence. In 2021, that percentage dropped to 35.8% on time. In other terms, pre-pandemic, shipping from China took between forty and sixty days. Now, that same container could take around 110 days to arrive.
We’re now two years into the pandemic that ballooned out of control in March of 2020. The value of inventories hit an all-time low a few months later, in June of 2020. While prices rose at the time to account for the shortage of labor and materials, all involved believed there would be a quick end to the struggle. As the pandemic lingers, the problems with supply chains and labor shortages continue to compound, leading to more delays that drive prices ever higher.
Looking Ahead
Customers can expect more price increases as many businesses attempt to cover their costs. However, this can only help businesses so much, as many have lost hundreds of thousands and even millions of dollars to these shipping delays. Companies are closing under-performing branches, moving to online-only models, and cutting product offerings as the crunch gets more severe.
Some believe the shipping crisis will come to an end soon, but the damage is already done. Without the ability to actively plan for the end of the shipping crisis, and therefore potentially the end of the supply chain problems, solutions are needed now.
A mixture of creativity and technology can work wonders for many seeking logistics services. While even the best solutions will still be delayed due to supply chain constraints and the shipping crisis, there are ways to shorten lead times. Rather than simply accepting the most common shipping partner or relying on traditionally popular options, those who take the time to seek out logistics partners that actively seek solutions to the problems they’re facing could see faster delivery times. In turn, those timely deliveries could help to restore inventory levels and lower purchase prices for their customers.
The Solution
That creative and technologically savvy solution is right here, with LIWMI Logistics. Technology helps us determine where space is available in freight containers, trucks, trains, and even the last-mile delivery vans. Wherever we can place your goods for transportation, we’ll take advantage of the opportunity to get your products here as soon as possible. Reach out to learn more.
