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Shippers should embed carrier financial health into resilience plans as pandemic upends logistics

June 23, 2020 / Matt Leonard
SHARESHARESHARE

Capacity imbalances stemming from the coronavirus pandemic seen across freight modes throughout early 2020 could continue as the result of "expected future volatility in consumer demand," according to the newly released State of Logistics report, titled "Resilience Tested," from the Council of Supply Chain Management Professionals (CSCMP), Kearney and Penske Logistics. "We are fairly certain that supply chains and the logisticians supporting them will have a new focus on resilience," Michael Zimmerman, a partner at Kearney and author of the report, said during a press event Monday. "And that means having more options. Multishoring and higher inventories are two likely outcomes." Part of the increased focus on resilience will require shippers to place "new demands on the providers and managers of logistics capacity," according to the report. Shippers should also consider planning for multi-modal, multi-carrier alternatives to existing routes. "Can you switch if need be from passenger belly transport to pure freighters?" the report reads, "If so, will the cargo arrive at different ports, requiring domestic truck transport? Now is the time to plan that out." As a global recession leaves companies across industries struggling, the financial health of carriers and suppliers is an important consideration for a shipper taking stock of their supply chain resilience, according to the report.