Supply Chain Lessons We’ll All Remember After The Pandemic

2020 was a year, wasn’t it?

Of course, you don’t need me to tell you — nearly every aspect of our lives, from our work to our free time to everything in between, was impacted by various safety requirements during the pandemic. If you happened to work anywhere along the supply chain/retail system in America, you were on the receiving end of some of the worst of it.

Constant disruptions to the supply chain, sudden product outages, distributors closing up shop or delaying shipments at the last second…it all started to pile up, and even the biggest, most successful warehouses found themselves struggling to fulfill orders in a timely manner.

This led, quite naturally, to the reconfiguring of supply chains in several crucial areas. While a lot of these changes were focused more on short-term survival, now that the pandemic is very slowly coming to an end thanks to the availability of vaccines, a lot of suppliers and distributors are asking themselves…what do we need to change back?

We’ve all learned a lot of lessons and made a lot of tweaks to how we do business over the last year, but in a lot of cases, we’ve found that these may actually be preferable to the way we were doing business beforehand. To that point, here’s five lessons we all learned during the pandemic that we may want to remember going forward:

Supply Chains After COVID-19

Identifying risks before they become problems

In an ideal world, we’d all be able to foretell each and every issue our supply chains could encounter, from product shortages to shipping vessels getting jammed up in the Suez Canal, and so on.

While we’re not all gifted with psychic ability, we do have access to a greater wealth of knowledge than ever before, and we’d do well to use that knowledge to predict issues before they can affect our operations. The Harvard Business Review cites the example of working with suppliers and subcontractors who focus on one specific area of supply or manufacturing, such as electronic components. While having a good relationship with your suppliers is paramount, it’s important not to limit your options for obtaining parts or items in case of an emergency, and identifying backups can go a long way.

This is a pretty big picture example, but the lesson is the same — by taking the time to identify potential faults in your supply chain, you can prevent them from getting worse.

A bigger regional focus

The conditions of the pandemic resulted in many warehouses and distribution centers refocusing their attention on their immediate geographical area, as opposed to the national (or even global) sales that they worked with in the past.

As IMD explains, a lot of businesses will begin searching for regional distribution hubs to better manage inventory and complete delivery. This has the dual advantages of eliminating single-source delivery (which goes back to the previous idea about not relying on one source for certain goods anymore), and can help focus on allocating and distributing goods to a given geographical area in the event of product shortages. (Remember trying to buy toilet paper this time last year? Yeesh.)

Better management of disruptions

No matter what your warehouse stored, or what industries/regions you served, the one thing we all had in common was the constant disruptions along the line. Shortages, missing trucks, moved deadlines — there’s not much we can do to prevent them, but there’s a lot we can do to better mitigate their impact.

An article by McKinsey pointed out that a lot of these disruptions were caused by the just-in-time delivery practices adopted in recent years by many industries. While this sort of manufacturing and distribution isn’t without its advantages, it still leaves a lot to be desired in the way of safety stock. As regularly as time allows, review your sales figures to try and identify the items most at risk of selling through, and do what you can to source backups or find safety stock in the meantime.

Safer warehouse layouts

Remember the first time you heard the phrase “social distancing”? More innocent times to be sure, but even as the pandemic winds down, a lot of the safety ideas posited during the height of COVID will remain in place. Experts suggest that a number of the warehouse layout changes we’ve undergone in the name of safety aren’t going anywhere, at least not for the foreseeable future.

Luckily, it’s easy to balance these changes with the need for productivity. Shelving Inc points out that many of these changes will actually help to increase productivity throughout the average warehouse, even something as simple as wider aisles for easier flow of traffic.

Recognizing customer shifts

Finally, one of the biggest lessons for supply chains over the past year, was how quickly customer demand could change, and how the items in demand could catch us all off guard.

Deloitte points out that the shifts in customer demand could come from seemingly out of nowhere, and need to be responded to more quickly than ever before. A more careful monitoring of sales figures vs. stock on hand for nearly every item across the spectrum will become the norm in the near future, and will go a long way towards preventing — or at least lessening — the sort of shortages we’ve seen in the past.

No matter what happens in the future, remembering the lessons of COVID-19 will prove invaluable for the long-term health of supply chains and warehouses throughout America.