It has become difficult and challenging for businesses and companies to gain a competitive edge in the global marketplace without properly implementing the logistical system. The world has become interconnected and complex; it offers opportunities for economic growth with new types of challenges and disruptions. Today, we’ll discuss the top 10 global logistics issues.
Top 10 Global Logistics Issues
Some of the top 10 global logistics issues are as follows;
Visibility and Transparency
Customer demands and requirements play a key role in the logistical industry. When it comes to offering complete transparency and visibility over the supply chain network and process; then it involves various independent parties and stakeholders, and it is not possible in global logistics. In order to make the entire SC and logistical network transparent and visible, it requires you to integrate various activities and processes within the company and the external stakeholders.
Government Regulations & Compliance
In order to reach the end consumers and final destination, goods have to go through various channels and mediums like air, sea, and roads. The global shipments go through various security checkpoints, logistics dealers, and different transportation modes. However, security is the main and critical issue and the logistical companies have to comply with various security programs like AEO and C-TPAT to secure their network and processes.
Capacity of Carrier
When the logistical company or the container carrier is serving a lot of people, then overcapacity of ocean shipment is the main issue in the global logistical industry. Oversupply and limited demand is the main cause of the problem. On the other hand, the shortage of truck drivers in the US is delaying the delivery of goods across the country. High regulations and an aging population are negatively impacting the US trucker industry.
Timely delivery offers businesses and companies a competitive edge in the logistical industry, but various factors cause the delay. The US West Coast port is the world’s busiest destination and it serves a lot of vessels for overseas deliveries. The port experienced the problem of vessel delays and they were stuck for many because the pickup containers were late. It resulted in the form of backlog issues in the distribution warehouse and caused a large gap in the final delivery of goods. Some of the other issues that caused the delay are;
- Holiday season
- Storage charges
- Political insurgencies
The global logistical network is comprised of internal trade lines and a lot of vessels (trucks, cargo ships, flights). Limited infrastructure at the end destination for the large vessel would cause delays in material unloading. However, it creates congestion problems at the shipment port, because the material loading on trucks takes time. Some of the other infrastructure challenges that companies should consider are as follows;
- Weather problems
- Bad road conditions
- Technological development
Unpredictable SC Risks
The 2020 crisis proved the unpredictable nature of the global SC and logistical network and processes. A wide range of issues and problems could impact the logistical operations of businesses and companies. In order to avoid or reduce SC problems and issues, it is significant that you should select a trustworthy and reliable shipping company.
Climate change and natural disasters have a great impact on logistical operations. The legislation and regulations on climate change have been increasing. It is significant to mention here that sustainable practices and strategies are more profitable and lucrative than non-sustainable strategies. Companies should implement sustainable practices for the efficiency of their logistical operations.
- Route optimization
- Recyclable packaging material
- Removing excessive packaging
Various manual processes take a lot of time in the logistical industry like manual barcode scanning, signing, and filling of papers and documents. The same information should go back to the manufacturer, but often it doesn’t go back to the manufacturer for days. It results in the form of shipment delays and spending a lot of time on data consolidation.
Theft of Goods
Many people manage stock at the cross border and transit points. If one of the persons has ulterior motives, then it results in the form of theft, robbery, or similar type of big issue. For instance, a shipping person signs the document and delivers 100 boxes, but they are 99 in reality. It is difficult to track stolen items when there are many transit and checkpoints. You can’t know for sure at what time the items have gone missing in the global logistical network.
Counterfeiting is the process of fake branding and false labeling; when the company disguises itself to be someone or something else. When companies are selling products globally, especially in Asia, then counterfeiting is a serious problem and challenge. It is because you can’t verify the authenticity of the products on the other continent.
Conclusion: Global Logistics Issues – Top 10
After an in-depth study of the top 10 global logistics issues; we have realized that the logistical industry deals with various types of issues and challenges. If you are learning about the global logistics challenges, then you should keep in mind the abovementioned problems.
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