Pandemic Shipping Chaos: Why It’s Happening and What You Can Do to Protect Your Business

The pandemic has had a devastating and multifaceted impact that’s been felt around the globe for more than a year.

And as some countries ramp up their vaccination rollouts and businesses start looking to get their feet back underneath them, there’s another challenge facing them as a result of coronavirus: chaos in supply chains and shipping.

Here’s a look at why it’s happening and what you can do to reduce the impact of it.

How Coronavirus Has Caused Chaos in Shipping Goods

The pandemic has caused what many people refer to as a “perfect storm” for global trade, and there are a number of factors that contribute to this.

Lockdowns Created a Shipping Boom

When lockdowns took place, the demand for container transportation skyrocketed, exceeding supply capacities. The reason for the increase in demand was that people began spending a lot more time working from home and staying inside, in turn spending less money on travel and services. As a result, many have been investing more heavily in things like furniture, electronics, sports equipment, and bikes rather than saving money.

There’s a Shipping Container Shortage

On top of this demand boom, there’s a global shortage of shipping containers.

Why does this matter?

Anyone who needs to ship large items or high volumes of items rents shipping containers to transport these goods. The problem is that there are only two companies in the world that build and sell shipping containers which has made it extraordinarily difficult to increase production to meet demand.

Ports Around the World Are Bottlenecked

All around the globe, ports have been bottlenecked, causing increasing delays in intercontinental ship traffic.

For instance, capacity at Rotterdam, Europe’s largest port, is reaching its limits–the port only has so many quays, cranes, and terminals.

Also, non-stop demand for ocean freight from Asia to the US has been overwhelming major US ports, which has meant many ships were kept waiting to make deliveries.

Then, just as conditions were starting to get better from Asia to the Mediterranean and Europe, the Suez Canal was blocked by the Ever Given, a container ship that ran aground and blocked traffic in both directions. It has since been freed, but it’ll likely take global trade months to recover.

Shipping Costs Have Skyrocketed

The combination of the increase in demand, the shortage of containers and shipping space, and back-ups in global ports has caused shipping prices to increase significantly.

With ocean freight having become expensive and unreliable, shippers have been forced to pivot toward air cargo.

Issues With Trucking

Trucking volumes, rates, and employment have been climbing since the summer, rebounding rapidly from an early pandemic slump.

But with high demand from consumers, importers are rushing to replenish inventory, causing capacity in trucking to tighten and driving rates up. And there are new challenges with trucking, given that quarantine rules in many places for returning truckers could cause significant delays in getting drivers back on the road.

What Can You Do to Reduce the Impacts of These Delays?

For many businesses, these delays mean significant delays in getting key operational products, from poly mailers to money processing equipment, ATM supplies, and more.

In order to reduce the impact of these delays on your business, it’s important for you to understand that your lead times are longer than they used to be and to place orders further in advance than you typically would.

If you’ve got the space available to you, then it’s worth ordering higher volumes of these products than you might normally to ensure you’ve always got stock on hand.

Or, if you don’t, you may want to look into alternative options for placing larger orders. For example, at Northern Specialty Supplies, we offer our customers the ability to use our innovative warehousing solutions which allow our customers to order in bulk, store their overstock in our warehouse, and have access to their products on-demand.

This means our customers get to take advantage of economies of scale but, more importantly, it cuts down lead times and avoids the risk of them ever getting caught off-guard by shipping delays.

It’s difficult to predict exactly when or how these shipping delays, challenges, and disruptions will stop, and that means one thing is for sure: it’s vital to make sure you’re planning ahead and acting accordingly.

If you’d like to learn more about our innovative warehousing solutions, get in touch with us today.