Covid-19 has transformed businesses across the world with greater attention being given to supply chain optimisation, growth of 3PL’s and meeting essential and non-essential delivery challenges. However, the worldwide lockdown comes with uncertainty, a complex process, and global outages, putting businesses in a pickle, but hopefully certain parts of the COVID impact – wearing masks, social distancing, remote learning – are (fingers crossed) temporary. Even with that hope, it is not untrue that this period has forced the Supply Chain Companies in India to evolve to survive this wave.
As a consequence, people working in logistics, operations must be better prepared to handle sudden and unexpected changes in demand. However, at the same time, there might be a lot of challenges to get back on track and maintain an acceptable level of profitability.
Of course, the push for warehouse automation was in full force before the Covid-19 but the worldwide pandemic forced the companies to change their strategy from “we can think about” to “we must have it” if they want to sustain in this industry.
Be it the ageing population, globalization, green logistics, urbanization, individualization, or digitization, if history has taught us anything, it is to learn from it and give it enough consideration to make a long-term vision so that we are ready to face any challenge.
The impact of COVID-19 and how it is transforming the logistics and Supply Chain Companies In India
Imagine ordering a product online, shopping for that perfect purse for a special someone but the lockdown, the standstill of the economy and delayed supplies make you wonder what goes on behind the order you placed in? Well, that’s what the pandemic has done to the 3PL industry. The shortfall of Inventory. Delayed supplies. Transportation delays and more. However, it has forced the industry to adapt itself to the new changes which were bound to take place sooner or later.
Undoubtedly, the acceleration in digitization, however costly and time consuming it was at first has turned out to change the industry in totality. From warehouses coping up with adjusting inventory counts, making space for work in process (WIP), to implementing social distancing and decentralization, Warehouse automation has helped reclaim the time lost in finding the inventory to computerising it, improving the efficiency and making retrieval and delivery more effective.
Increase in Cold Storage
Overwhelmed by the pandemic, many businesses faced tons of losses, but the industry which saw a boom was the cold storage units. How? Well, with lockdown being imposed worldwide people wanted to store up on items and what would be the best of those? Frozen meals! From food to medicines to dairy products, cold storage saw a whopping 65% rise in demand.
Scalable Processes & Picking Strategies
Fluctuations in order demand are very difficult for businesses to handle but the industry which gets affected the most are warehouses. Excess inventory or shortfall in inventory, it’s the storage that gets affected by the specific good. In the wake of COVID, warehouses have been trying to implement scalable processes to manage unpredictable demand. From using a combination of expensive and time-saving technologies to software solutions, warehouses are implementing automatic processes for flexible order picking strategies to handle the demand.
Greater Reliance on 3PL Distribution Networks
We saw the world come to a standstill and yet we tried to bring the customer and businesses together. Manufacturers, businesses are looking to decentralize warehouse locations and be closer to the end customer either by building infrastructure overall or by outsourcing your inventory to 3PLs. However, the choice depends on the company- small, big, or even medium-sized, outsourcing your inventory will play a bigger role in future warehouse and distribution centre fulfilment.
Accelerated Growth of eCommerce
If COVID taught us anything, it’s that the future is unpredictable, which for e-commerce companies has turned out to be a blessing in disguise. Though covid didn’t start the rise of the industry, it surely sparked it. From rising demand in goods to warehouses leasing space for goods in loads, the impact of accelerated eCommerce orders has changed the order profile of the warehouse significantly.
Importance on Inventory Visibility
It’s impossible to work with inventory as you used to in the pre covid days. You just can’t count what goods you have at the end of every week but have to keep track of your items on a real-time basis. The ability to know, in real-time, exactly what inventory is on hand at each warehouse is the key to assigning and filling orders efficiently. However, only a few 3pl companies have full visibility to let their clients keep a thorough check on their inventory. As warehouses look to decentralize operations, the need for real-time inventory visibility will increase tremendously.
The future of 3PL logistics in a post-COVID-19 world
Without a doubt, this has been the most difficult shipping environment for all the supply chain and logistic professionals in our history. But as an industry that is changing its ways with every problem it comes to face to face with, it’s time to buckle up and make the most out of the pandemic. With COVID-19 revealing for many businesses that they have a lack of visibility that reaches deep within their supply chain, a move toward improved visibility as the pandemic unfolds will be the best solution.
Advanced data analytics, warehouse automation, technology has helped many businesses in the past to gain more visibility into their supply chain and mitigate disruptions. Other than this, the future of 3PL logistics lies in inventory management and control. From the adoption of warehouse automation software to other effective and efficient ways to save time and space, the emphasis is to come at par with the raging appetite of customers worldwide.
As we settle into our post-COVID lives the only certain thing is that nothing is certain. It’s time to be adaptable, make backup plans, be as flexible as possible. It’s time to start utilizing space efficiently and manage their biggest expense – labour effectively.
Aaj Enterprises
