“THESE ARE THE TIMES THAT TRY MEN’S SOULS,” WROTE
Thomas Paine in the famous Revolutionary War pamphlet series, The
American Crisis. Today, we could just as easily say “These are also the times
that try our supply chains.”
Supply chains are definitely being tested by Covid- 19. How they respond
will shape how supply chains are designed and managed for years to come.
This current worldwide crisis has revealed a number of weaknesses.
First, we are finding that our supply chains are much too long. Webuilt them primarily on the basis of cost, sourcing products from Chinaand other nations where labor is cheap. In actuality, therecent wave of tariffs on Chinese goods may be a blessingin disguise, as it prompted companies to move some oftheir manufacturing out of China before the coronavirusoutbreak. However, many simply shifted their sourcingto other Asian countries, which means that while goodsmay be available, they’re now stuck in ports and unableto reach our shores. To mitigate these risks, companiesneed to shorten their supply chains and broaden theirsupplier bases so they aren’t reliant on limited sources allfrom the same part of the world.
We are already seeing product shortages in U.S.
stores. This will continue in many categories even when
products become available because there likely won’t be
enough workers to perform retail replenishment tasks.
I believe that direct-to-consumer retail will grow not only during thecrisis, but also after, as consumers recognize the ease of shopping onlinefor their everyday needs. Retailers will have to improve their in-store fulfillment capabilities to allow for faster pickups and home deliveries. As aresult, there will be a surge in the deployment of picking technologies atthe store level to reduce reliance on labor-intensive cart picking.
I also think that distribution centers will deploy more automation. Thiscrisis is revealing the risks of relying on large numbers of people working in close quarters to fill orders. While we do not design facilities forworst-case scenarios, we do want to build into them the flexibility to bendwithout breaking under all conditions—normal, peak, and crisis periods.
We will also see advancements in automated trucks and delivery vans
that will keep products flowing even when drivers are sick or quarantined.
I hope that someday we can look back on this crisis to see how it spurred
the development of stronger, more resilient supply chains. And if we can
find a silver lining, it’s that the general public is now more aware of the
supply chains they once took for granted.
BIGPICTURE
Editorial Director
The times that try our
supply chains
David Maloney
Editorial Director
dmaloney@dcvelocity.com
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Executive Editor
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Senior News Editor
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Associate Editor
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Editor at Large
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Managing Editor - Digital
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Editor Emeritus
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Group Publisher
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