How to Prepare for Global Logistics in 2022

Shippers have had to become increasingly nimble and informed over the past year, and going into 2022, it’s critical to remain agile, open to alternative solutions and stay informed on the latest market insights.

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2021 was a difficult year in global logistics due to ongoing volatility. The supply chain industry was navigating the Suez Canal block, hurricanes and cyclones, port and terminal closures due to COVID-19 outbreaks, customs and trade changes, labor shortages and more.  

Even those who’ve been in the supply chain industry for many years haven’t seen a level of continual disruption across the entire supply chain for this length of time. However, with this year’s volatility, there’s a new level of hyper collaboration, including individuals going out of their way to help each other, more strategy sessions between shippers and forwarders and continually leaning into historical data and current market insights to find smarter solutions. 

As a result, here’s some key strategies for global shippers to consider.

Seek creative solutions across the entire supply chain

At year-end, we typically see a jump in demand as shippers meet quarter-end quotas and prepare for the upcoming Lunar New Year, during which many factories in China shut down. However, in early 2022, shippers will also be juggling potential delays from the Winter Olympics, which will be hosted in Beijing throughout February. All of this is amid a strained supply chain market, which will take time to ease.  

As you prepare for 2022, consider what different modes, trade lanes or inland transportation strategies you can implement in the supply chain. For example, while it may not be feasible to transport 100% of your freight via air, air freight continues to be the fastest way to replenish inventory, so prioritizing specific freight can help keep cargo moving.

Additionally, as demand and rates will likely continue to stay elevated through the beginning of next year, less-than-container load (LCL) shipping is a strategy to consider. Typically, space for LCL shipments is easier to find especially in a constrained capacity market since you are only looking for some container space vs. an entire empty container. Also continue to see large cost savings with expedited LCL services compared to today’s airfreight environment.  

Keep in mind, LCL shipments are not going to bypass congestion at the ports, so inland strategies need to be considered. Currently, many ocean carriers are looking to move more interior point intermodal (IPI) cargo vs. focusing on port-to-port.

As you can see, looking at only one portion of the supply chain or one mode can only get you so far. It’s important to consider all areas to keep cargo moving.

Utilize data and technology

Although this past year has rendered a lot of unique situations and 2022 may do the same, historical data can still help us find solutions. Finding common trends and themes in your cyclical data can give you an information advantage to make smarter decisions for your supply chain.

Additionally, the right technology tools can give you the visibility and predictability you need to adjust. For example, with the ongoing port congestion and delays, enhanced vessel routing and tracking features help increase the efficiency and accuracy of port ETAs and automatically send updates if changes were discovered. This is important because ocean shipping is only one piece of the equation. Having visibility to changes in real-time gives teams and customers a chance to react and adjust other tactics down the road.

Click here to hear more about data in trucking:  

Look to global trade opportunities  

While congestion and shortages continue across transportation modes, one area where you may find opportunities for savings is in the global trade strategy. Since each country’s trade policies are unique and can change, it’s important to have regular meetings with your trade advisor to break through the complexity of total landed costs, including understanding costs to import, identifying duty recovery possibilities and reducing duty exposure via trade agreements.

Final thoughts

While there is no one-size-fits-all approach, the above options provide shippers with strategies to help mitigate delays and identify potential savings as we enter another potentially unpredictable year.

Shippers have had to become increasingly nimble and informed over the past year, and going into 2022, it’s critical to remain agile, open to alternative solutions and stay informed on the latest market insights.