It’s safe to say that 2020 will not be a year easily forgotten. This past year has been full of adjustment. Around the globe, our personal and work lives were upended with very little warning. As the pandemic spread, spending time with friends and family, conversations with co-workers, and even dependence on a resilient supply chain turned out to be necessities we had taken for granted, and normal has yet to return.
As we are entering the New Year, it’s time to look at ways one can make a smart plan for global shipping. By staying on top of supply chain management trends and issues, you can make sure that your company can readily adapt to changes.
COVID-19 changed everything about freight movement, and it did so at an incredibly rapid speed. Essential goods took over and non-essential goods took a backseat. Different modes; ocean to air, more parcel, track loads to intermodal, limited track loads capacity has been a huge factor in rising shipping costs, and retirements are happening without new drivers coming into the workforce. The shift to digital platforms was swift and now necessary for success; ecommerce has shifted strongly to “Buy Online Deliver From Store” (BODFS). Consumer spending grew in 2020 because people were at home, and will continue in the new year. The speed at which they shifted was quicker than anyone has seen in freight in recent history, and all factors occurred at once.
In 2021 we expect a growth in freight volumes. Goods production will recover and more products will flood the market. Intermodal volumes are expected to help compensate for truckload volume squeezes. Truckload spot prices are expected to increase. Contract bids are being reconsidered, but shippers should understand that the market is driving higher costs. Freight demand will be inconsistent in 2021. Air travel and dining expenses may cause an additional disruption that will weight on demand. Transportation costs will increase due to smaller fleets not adding capacity and spot rates will continue to rise. Ecommerce and rapid consumer delivery expectations will continue to impact freight costs and availability.
If you import from the UK to the EU and vice-versa, Brexit will mean extra administration chores and delays of shipments. It is also to be expected that new customs charges and other fees will be introduced.
Looking at the ongoing events around the world, many of the challenges we have experienced in 2020 are not going away—and there are potentially new challenges on the horizon. If there is one thing the supply chain industry needs to learn from these ongoing challenges, it is agility. Supply chains need to be flexible enough to absorb these shocks, major or minor, that comes on its way. Through our technology and global suite of service offerings, including ocean, air, customs brokerage, and surface transportation, we help customers mitigate the unplanned risks and changes of global shipping. Our people are willing and eager to help you plan for the coming year.
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