Everything in the supply chain will be reexamined – For years, the focus of supply chain management was to keep inventories at all locations as low as possible without impacting service levels. Now, with the issues experienced during COVID, companies are working to move more safety stock closer to the consumer.
The pharmaceutical industry will move from reactive to proactive mode for logistics. The disruptions caused by COVID made supply chain resilience a priority for pharma companies around the world. After having to deploy short-term tactics like producing and storing inventory wherever possible, they will move to the adoption of digital and automation solutions for resilience in their networks.
There will be a permanent restructuring of the food industry – Prior to COVID, 50% of meals were prepared away from the home. The pandemic dramatically moved the pendulum to the advantage of retail food providers. The foodservice segment will continue regaining some of the lost share of stomach but can expect to be down by 15% or more after the return to normal operations. This is having big ramifications for the cold food chain.
The Great Resignation will accelerate labor issues. Several macroeconomic and demographic challenges, including more open jobs than people to fill them, a stronger economy than anticipate, immigration policy preventing potential workers from entering the country and a birth rate well below replacement levels, will continue to make labor scarce. This will lead to a continued move to deploying automated systems and other labor-saving equipment.
Sustainability will become an opportunity for supply chains. Manufacturers, possessors, retailers and wholesalers will embrace sustainability for end-to-end delivery to increase revenue, enhance customer loyalty and meet ESG targets for investors. The bottom line is that sustainable delivery options now offer the lowest cost to execute.
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