A new survey found that supply chain leaders are very optimistic about the future. In fact, the survey, released earlier this month by GlobalTranz Enterprises, LLC, reveals that leaders are ready to meet surging consumer demand.
The data comes a year after the initial pandemic disruption of supply chains, and follows GlobalTranz’s survey of supply chain leaders in the fall of 2020, which indicated that decision-makers did not feel prepared for shifting logistics needs.
“Over the past year, companies serving both individual consumers and businesses have had to deal with changing buyer behaviors and inventory management techniques that have created significant supply chain volatility,” said Bob Farrell, CEO of GlobalTranz. “This survey shows that while there is consistent optimism in an economic recovery, supply chain leaders understand that many new challenges lie ahead and that partnering with technology-centric logistics providers is critical to enabling visibility across supply chains, boosting e-commerce capabilities and meeting customer demands.”
COVID-19 Vaccine Impact and Future Outlook
Six months ago, companies were faced with record-breaking shipping volumes due to increased e-commerce demand on top of peak shipping demands during the period that preceded the holiday season from October through December. Supply chains continue to operate at these peak levels and consumer and business buying activity isn’t showing signs of slowing down in 2021.
Despite global supply chains being overburdened, decision makers still believe their own supply chains are prepared to meet consumer demand. Confidence in their logistics partnerships is high, with 91% of respondents agreeing that their 3PL partners will effectively meet their needs in 2021. This confidence in current partnerships to navigate the market and in the decisions made over the last few months is driving optimism in these decision makers ability to meet their business challenges.
With a confluence of economic and societal factors at play, only 1 in 10 decision makers reported a pessimistic outlook of their company’s revenue 3-6 months and even a year from now.
- 7 in 10 respondents believe the COVID-19 vaccine rollout will enable them to attract new customers; 94% of respondents reported confidence that there will be robust economic recovery due to vaccine distribution.
- 6 in 10 believe that the latest stimulus packages will benefit both their operations and business revenue.
- More than half anticipate that regulatory policy coming out of the new U.S. administration will have a positive impact on their business operations and revenue. This sentiment comes as major bills around infrastructure are introduced in Washington D.C.
At the same time, decision makers took note of challenges that remain across their supply chains:
- 37% noted rising transportation costs as something they will need to continue to manage throughout 2021.
- 31% reported concerns over having enough workforce to meet the demand for consumers.
- 24% cited poor handling or service related to home deliveries as an ongoing challenge; 76% cited concerns over the ability of their small parcel provider to deliver on time.
- 1 in 3 list having enough resources (parts, materials, product, etc.) as a top concern to meet the demand of customers
Adapting to New Market Demands
Survey data shows that supply chain decision-makers feel that they have made appropriate adjustments to meet the heavy shift in e-commerce activity in the market, with 76% of respondents noting that their company has adopted a successful omnichannel strategy, a 20% increase from GlobalTranz’s October survey. At the same time, 84% of respondents reported that they’re seeing greater demand for final mile delivery services, with 69% struggling to find reliable transportation partners to meet this demand.
Continued market volatility into 2021 has forced decision-makers to reevaluate supply chains:
- Nearly 80% indicated increasing warehouse space and expanding warehouse locations are priorities in 2021
- 82% of respondents said that investments in supply chain visibility are a priority
- Over three-quarters of respondents indicated reshoring or nearshoring of supply chain operations as a priority
Outside of immediate supply chain operations, at least 25% of respondents indicated investments in new products and services, customer retention and recruitment top the list of priorities for the year.
“With much of 2020 marked by the growing pains from the dramatic shift to an e-commerce dominated shipping landscape, we have seen companies effectively accelerate plans that were years down the road,” said Ross Spanier, executive vice president of Direct Channel Business at GlobalTranz.