Supply Chain Changes Post Covid

Supply Chain Changes Post Covid

Covid-19 has transformed 2020 into a year we will never forget. It changed the way we live, and will transform how society moves forward.

Now that we are roughly a half year into the pandemic, the weaknesses in the way the world previously operated have been popping up all over the place.

One of the earliest problems identified were issues within our supply chains.

Our buying habits have changed drastically, and we remain unable to meet demand for all kinds of goods, from hand sanitizer and toilet paper to meat and produce.

The future of the supply chains

A large contributing factor to this issue is that so many of our supply chains are designed to deliver the cheapest possible product - which in turn means that these chains began in the places that could provide the cheapest materials and labor.

It was an effective method for quite a few markets and companies for a long time. Many companies didn’t foresee a need to prepare a plan for disruptions to that chain, and had to move frantically to mitigate the damage.

In the wake of this pandemic and the disruptions it’s caused to business as we know it, you can expect to see significant changes in how supply chains are operating. We will see a lot of new supply chain technologies emerging, reshaping the industry as we know it.

While we don’t know exactly what they will look like yet, It’s time to make some educated guesses and prepare next steps.

A Shift Toward Regional Supply Chains

When the novel corona-virus exposed the flaws in the status quo, a push grew to restructure supply chains regionally. An increased focus on wellness and mindfulness have many of us wanting to know where and how our food was grown.

This is something that factory farms have never provided. Also, decades of cheap imported wares and widgets have created a renewed demand for well-built products that were constructed to be something more than just cheap.

In addition to issues of product quality and provenance of produce, a campaign has emerged to bring mining and manufacturing jobs back to the US.

Expanding the operations

While the prospect of the return to local farming and manufacturing is great news for small and medium sized local businesses, many of them will need to expand operations to meet new demands in a changed world.

Some have already got the space, but will need to determine if their warehouses and technology can compete. Investing in tools like conveyor systems will allow companies to design new layouts that give workers personal space and allow regional producers to more effectively meet the demand that has become expected under the current system.

More transparency in the supply chain process

One of the strongest benefits to moving our food supply chains home is the transparency and traceability it provides. Over the past decade or two, we’ve seen an increasing number of mass recalls that involve unsafe or tainted products.

For example, in recent history, grocers had to dispose of all of their romaine or peaches due to salmonella outbreaks, while authorities were left with the task of trying to identify the source, as well as who may have been affected.

All affected parties had to operate with an abundance of caution because of the difficulty involved in tracing illness clusters in Minnesota to a farm in California or Arizona. Smaller, more sustainable supply chains mean we can easily identify defects and trace the path products take from producer to consumer.

Rethinking Workspaces

Another flaw that has been exposed by our current situation comes down to inefficient workplace design. Many of our supply chain disruptions occurred because cramped work spaces and poor air flow turned factories and processing plants into locations with much higher than average spread of the virus.

The buildings were not designed with air exchanges or room for employees to spread out, which meant many people were stuck in close quarters, breathing the same stale air for half a day at a time.

These factors may have been nice additions to past plans, but they will likely become essential elements for all factories and warehouses moving forward.

Rising Costs

The time was eventually going to come where we would be forced to exchange rock bottom pricing for ethically and sustainably produced food and fashion.

We loved the fact that we could buy cheeseburgers for a buck so much that we were willing to close our eyes as to where our budget beef was coming from.

Machines performed the cold, repetitive tasks that we didn’t want to pay people to perform. The problem with keeping people out of the equation is that machines aren’t as adaptable and agile as people are.

When outliers such as global pandemics hit, the machines will simply do what they were programmed to do. It takes a human element to ensure that we are able to adapt to change.

But, in order to bring humans back into the equation, we must pay them. This fact inevitably leads to increasing prices across the board.

Creating sustainability

Sourcing locally reduces the number of hands products must travel through to reach us. Cutting out some of these middle men will also help keep prices from going through the roof.

By sharing the cost among everyone from farmers to consumers, and everyone in between, we can create a sustainable system that works for all of us.

By optimizing our local facilities and moving our supply chains home, we create and keep jobs in our communities. We will adapt to these changes because we must.

In conclusion

The change was inevitable, this pandemic was just a catalyst for the change that was long overdue. Things are happening way faster, we will have this unique opportunity to witness the transformation.

Shift to more transparent processes, technologies such are IoT and AI. Supply chains were always overly complex but maybe the key lies in simplifying. Simple and transparent system is the main goal and we will see how we will connect the dots.

Last updated:8/25/2020 4:47:22 AM
Jason F. Hopkins

Jason F. Hopkins

Jason is a business consultant with a passion for writing. Doing his research, exploring, and writing are his favorite things to do. Besides that, he loves playing his guitar, cooking, and traveling.


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