Why Partnerships and Customer Service are Rising as Critical Differentiators
- Global supply chains are stressed and will remain stressed for a while.
- Businesses are adapting their supply chains in innovative ways.
- Businesses are buffering the effects of the non-stop disruptions.
- Partnerships and customer service are the new supply chain imperatives.
This has been a year of non-stop supply chain disruptions. They keep coming like a battering ram. As a result, supply chain matters now have the attention of C-suite executives. As a result, shippers and logistics service providers are adapting in unique ways to weather the perfect storm.
This blog post explores how shippers and logistics service providers are averting crises.
Let’s dive in without further ado.
Volatility and Uncertainty Overwhelming Shippers
Supply chain disruptions are battering businesses like never before. The industry has always dealt with disruptions, but not at the pace and number we see today. And they’re happening all at once.
It’s an intense environment. DB Schenker’s CEO for the Americas, Hessel Verhage, calls this a “perfect storm.”
To understand this better, let’s see what’s affecting supply chains. Multiple disruptors are converging all at once to create chaos and confusion.
· Record-breaking container shortages hamper the uninterrupted flow of cargo.
· Relentless shipping delays lead to widespread shortages.
· Increased shipping costs from pre-pandemic rates of $1,200-1,500 to $10,000-15,000.
· Rampant labor shortages further handicap supply chain flows.
· Extreme weather events like Hurricane Ida add to delays and costs of transport.
· Invasive government regulation aimed at stemming the spread of Covid’s Delta Variant.
· Decaying infrastructure that impedes the smooth receipt, delivery and transport of goods.
Plus, these disruptions add costs to your operations. The estimated additional cost to consumers is $184 million/year. Supply chain disruptions are challenging businesses on all fronts with forceful impact.
Yet, businesses seem to survive the perfect storm somehow, at least for now.
How Some Businesses are Adapting to Continuous Volatility and Uncertainty
Shippers and 3PLs alike are developing new and creative solutions to survive. For the moment, they’re working.
Let’s see what some businesses are doing to adapt to the volatile market.
· Buy logistics companies – American Eagle Outfitters purchased logistics company, AirTerra, to improve order fulfillment, and like Amazon, and now offers same-day deliveries.
· Some companies, like Home Depot, have contracted their own container ships.
· Mega-retailer, Walmart, has chartered vessels to ensure it has the capacity it needs.
· Retailers like The Gap, Kohl’s, and Hugo Boss are shifting to air freight to stock up for the holidays.
· Benetton has moved manufacturing out of China to Egypt to shorten its supply chain.
· Syfan, an Atlanta-based logistics company, has entered into partnerships with local and state colleges and universities and funded scholarships, and internships to assure access to talent to blunt labor shortages.
This is how some businesses are containing the wrenching disruptions.
Too Big to Solve Alone
It’s a wild, wild world. And there’s no escaping it. So, what can a shipper or 3PL do?
What is emerging is a focus on partnerships and customer service. Bellwether businesses, like Amazon, were already moving in this direction. Now, companies of all stripes recognize the strategic value of partnerships and customer service.
It’s all about satisfying customer demand. That includes providing a pleasant customer experience. That’s easier said than done, especially in today’s trying times. When done in partnership, the value of customer service rises to another level.
Why is that?
Partnerships imply close collaboration. When pursued for the long-term, partnerships thrive because they benefit from deeper relationships. That helps build trust and understanding. And that leads to innovative solutions focused on resolving immediate and persistent issues.
When you understand your partners better, you can help them satisfy their customers better. That’s even more important in an environment of increasing complexity.
Be aware, going it alone has limitations, and that’s not viable in today’s chaotic marketplace. As a result, firms that emphasize partnerships and customer service will thrive. They will outdo their competitors who don’t adopt these supply chain imperatives.
What Next Steps Should You Take?
We suggest you contact a dependable 3PL that recognizes the strategic value of partnerships and customer service.
At American Global Logistics, we’ve already adopted tomorrow’s supply chain imperatives. We recognize the strategic value of partnerships and customer service. We founded our business on developing long-term partnerships long before the pandemic.
Contact us today to see how we can help you not just ride out but also profit in these challenging times.