Cost Optimisation

Top 5 Logistics and Supply Chain Challenges in 2022

March 7, 2022

Top 5 Logistics and Supply Chain Challenges in 2022

By now, we’ve all heard more than enough about what ‘unprecedented times’ we’re living in. It’s clear the 2020s are going to be anything but normal, and that includes the challenges that logistics, shipping and supply chains at large have to contend with throughout 2022.

What are the biggest challenges of logistics and supply chains in 2022? Let’s dive into the five most pressing obstacles facing logistics’ business as usual – and what might be done to overcome them.

The international aftermath of COVID-19

While popular rhetoric is that the pandemic is on its last legs, there is actually still a huge road still ahead of us as a global society.

Even with vaccines administered and lockdowns a thing of the past, supply chains and logistics are disrupted by COVID-19 every day.

The spotlight has never shone brighter on the interdependency of the global supply chain, with many companies looking to reduce dependency on overseas producers and reshore production closer to home.

As illness takes frontline workers unawares, even if they’re taking the utmost precautions, absences in the workplace are having ripple effects throughout the value chain.

From a lorry driver struck down with COVID-19 who now can’t move a vital order, to floor workers and manufacturing operatives creating inadvertent superspreader events just by doing an honest day’s work, this is still a challenging landscape to navigate.

This is further compounded by the fact that careers like lorry driving, warehouse operative, factory floor worker and other key supply chain roles are all experiencing dramatic shortages worldwide. With the Great Resignation having motivated countless people around the world to reconsider how they earn a day’s wage, showcasing the appeal of these vital vocations is proving problematic for many.

Geopolitical factors

The shape of the world seems to be constantly changing. For supply chain and logistics businesses, this means the best practices that worked like a well-oiled machine even a few short months ago are suddenly buckling under unexpected pressures.

Often, these incidents have far-reaching aftershocks too. The impact of Brexit in terms of global supply chain disruptions and the accompanying bureaucratic confusion continues to be felt – and the aftermath of the Russia-Ukraine conflict is an issue analysts are revising their advice on by the day as situations develop.

This is one of the chief contributing factors as to why risk mitigation has become such a hot button topic among thought leaders in logistics, shipping and supply chain solutions. The effective collection and implementation of data to smooth out processes – and the means by which to do one’s utmost to pre-empt shifts in the geopolitical fabric – will prove vital in 2022 and far beyond.

Environmental sustainability best practices

How can supply chain and logistics businesses meet the needs of net-neutral governmental policies – and contribute meaningfully to the discourse surrounding them from a position of thought leadership – when demand for goods and services is so high that everyone’s on the road more than ever?

The pressure on supply chains and logistics organisations to showcase electric vehicles, advanced technologies, smart route planning and more efficient journey timing has never been higher.

Fortunately, this is another field in which smart tech solutions can play a key role. Efficiency gains increase the cost-effectiveness of each journey undertaken in the supply chain, and that means both a greener and more profitable route forward.

Of course, such changes seldom happen overnight – and while automation is one solution, collaboration is quite another. Thought leaders are calling on supply chain players of all kinds to unite under established frameworks and best practices that will promote environmentalism and circular economics for every mile driven. It’s definitely a conversation in which every logistics business has a role to fulfil.

Demands will never slow down

It seems like a distant memory now to consider that much of supply chain management relied upon a certain sense of rhythm to the calendar year. This sense of seasonality has been replaced with unpredictably, all of which is further underscored by a critical core component – unrelenting demand.

The level of tolerance that consumers demonstrated when supply chains were disrupted at the advent of the COVID-19 pandemic, for example, was not to last. In fact, as online orders became the de facto way for people to order everything from luxuries to essentials, anything beyond a next-day arrival began to swiftly be seen as an intolerable wait.

This is compounded all the more by huge demands in sectors such as entertainment – where computer chip shortages render some consumer electronics impossible to find even years after release – and coffee, the appetite for which worldwide continues to grow as rapidly as environmental disruptions and ethical concerns in its cultivation.

Consumers and businesses are going to continue to require products and components at an ever increasing scale. Unfortunately, the idea that such demands could possibly override the capabilities of supply chain solutions providers worldwide is simply never taken into account in today’s culture of immediacy – meaning it falls to logistics businesses to step up once again.

Intelligent implementation of automation

There’s no denying that good AI and smart technologies have made logistics and supply chain management easier. Yet the pace of innovation is so rapid, and the rate of change being explored in this article alone so apt to accelerate, that implementing automation into logistics often can feel like chasing one’s tail.

Because these smart solutions are evolving in tandem with the emergent situations affecting supply chains worldwide, many logistics businesses make the mistake of waiting for a final or ‘calmed down’ climate in which to invest in these systems.

Not only does that only serve to stymy the pace of innovation, but it could well prove a long wait for a day that never comes – if anything, the world is only moving faster, meaning there are less advantages to this wait-and-see approach than ever before.

Developing resilience and supply chain intelligence

Just because there’s no longer any such thing as business as usual, that doesn't mean business can’t be better. In fact, the climate of demand and opportunity in logistics worldwide today makes this one of the most promising periods in which to be active in the industry.

Rise to meet the challenges we’ve discussed today, and you stand to gain profoundly from the challenges that have disrupted so much of the former status quo. It takes agility, foresight and the right technology to succeed – are you prepared to make 2022 your landmark logistics year?

Romain Fayolle

Co Founder & Managing Director

Strong with 8 years of experience in different international industries, Romain wants to connect Logistics & Supply Chain leaders and professionals with the game-changing technology