Supply chain disruptions likely to continue in near future
From Transport Topics. Economists and industry experts widely believe supply chain disruptions will continue to greatly impact the transportation industry for the first half of the year, and possibly into 2023. Stemming from the COVID-19 pandemic, the logistical bottleneck continues to reverberate around the world as carriers, shippers and third-party logistics providers attempt to deal…
From Transport Topics.
Economists and industry experts widely believe supply chain disruptions will continue to greatly impact the transportation industry for the first half of the year, and possibly into 2023. Stemming from the COVID-19 pandemic, the logistical bottleneck continues to reverberate around the world as carriers, shippers and third-party logistics providers attempt to deal with the impact on their operations.
Although AP Moller-Maersk reported record revenue and profits earlier this month, the shipping line said it expected supply chain problems to persist into the second quarter.
“We spent tremendous efforts in mitigating bottlenecks by expanding capacity across ocean [freight], improving productivity in terminals and growing our global logistics footprint,” said CEO Soren Skou. “We will continue these efforts as we see the current market situation persist into Q2.”
Despite the supply chain woes, high consumer demand continues to fuel record sales growth and profits for several major retailers. Amazon reported a 22% increase in net sales in 2021. Late last year, Kroger and Walmart also reported strong sales as they prepared for the approaching holiday season.
In its Q3 2021 earnings call, Kroger President and CEO Rodney McMullen said the company chose to incur some significant costs to bolster its supply chain. For example, additional warehouses originally brought on to support its business through COVID were kept open through the holiday season.
Walmart also made efforts to mitigate transit and port delays, such as adding extra lead time to orders, chartering vessels for goods, rerouting deliveries to less congested ports and expanding overnight hours at key U.S. ports. Brett Biggs, chief financial officer and executive vice president of Walmart, stated during the company’s Q3 2021 earnings call that the retail chain is also working with suppliers to mitigate supply chain congestion.
See the complete article online at Transport Topics.