3 Supply Chain Challenges Impacting Retail in 2022

A nationwide shortage of truck drivers, a lack of available warehouse space, and rising consumer demand are three supply chain challenges that will continue to impact retail operations throughout 2022.

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As worldwide supply chain problems have continued, retailers have carried on with business despite shortages and delays in the delivery of goods and inventory for their stockrooms. Retailers have needed to find ways around snags to ensure they can remain competitive, meet their customers’ needs, and prevent sales and revenue loss as customers wait longer to receive their orders.

A nationwide shortage of truck drivers, a lack of available warehouse space, and rising consumer demand are three supply chain challenges that will continue to impact retail operations throughout 2022.

But the good news is there are tactics to help tackle many of these challenges if retailers plan ahead. Here are the three top supply chain challenges impacting retailers and the strategies to successfully navigate them this year:

Trucker shortages

According to recent data, there is currently a shortage of approximately 80,000 truck drivers in the United States, according to the ATA – and it’s projected to double by 2030 if current trends continue. Freight carriers are a critical component when it comes to the distribution of goods. Having fewer drivers on the road means there are fewer goods moving at any given time, and without steady flows to and from warehouses, the entire chain is affected. Customers are having to wait longer between the moment they place an order and when it gets delivered to their doorstep. Similarly, packages may not arrive at a retailer’s warehouse on time (or at all), meaning they will have less stock available to sell.

Retailers can’t directly solve the trucker shortage, but they can prepare their businesses to meet their consumers’ needs and prevent massive out-of-stock situations or severe delays. By automating the inventory management process, merchants can have better insights into real-time order statuses, have software that automatically determines fulfillment workflow rules and better forecast supply and demand from data gathered about sales patterns. If retailers can proactively prepare their inventories and accurately view them, they will be better equipped to control their flow of goods as we navigate a slower-moving chain.

Lack of warehouse space

In 2022, retailers will also be affected by overflowing warehouses and a scarcity of space available. Expanding warehouse space seems like the most obvious solution, but this year has seen unprecedented demand for warehouses and increased costs in real estate, meaning they are in short supply or very expensive. Coupled with hiccups in delivery, like the trucker shortage, packages will have to wait longer before they begin their journey from their warehouse to their final destination - whether it’s a customer’s home or a retailer’s stockroom - creating severe logistics delays and a bottleneck in the flow of goods.

While not every business will be able to allocate more space for their stock by purchasing new warehouse space, there are other ways for them to gain more control over the fulfillment journey, and being flexible is key. Research from Linnworks revealed that 4 in 5 retailers at one point repurposed physical store space into additional fulfillment space to help with ecommerce orders, and only a third of those reverted it back into stores. Being flexible with the resources already available is one way to optimize fulfillment operations and, in turn, customer experience.

Growing consumer demand

Despite a global pandemic and endless supply chain challenges, consumers are shopping more often and in more places than ever, according to retailer research. Since the onset of the pandemic, online shopping activity has increased and continues to trend upwards. Consumers want more items and they want them delivered to their doorstep quickly. However, due to supply chain strain, businesses can struggle to keep up with these expectations.

As shoppers continue to shop across more channels, it’s critical that businesses have the proper tools in place to keep track of all their selling channels and ensure they’ve optimized their inventory distribution correctly. By investing in a platform that can provide a centralized view into all operations, retailers can more efficiently forecast demand for certain products or certain channels to ensure the corresponding warehouses are properly stocked. Having this centralized view into their business will ensure they are organized and prepared, especially as supply chain challenges continue to impact their operations.

The issues with the global supply chain will not come to an end overnight. But, in order to remain competitive and maximally efficient in 2022, retailers must leverage technology and automation within their operations to ensure they have the optimal distribution of goods in their warehouse and available across their selling channels. Automating the inventory management process, allowing room for flexibility with available resources, and investing in a platform that provides a centralized view into their business, will all be ways retailers can prepare their businesses for the ongoing supply chain challenges expected in 2022.


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