The impact that Covid-19 has had on the global transportation and logistics environment is unlike anything the modern world has ever seen. The impact can be compared to multiple serious hurricanes hitting all the major global transportation hubs without any warnings and at the same time. Due to the pandemic, the transportation and logistics industry has experienced unprecedented strain on every conceivable transportation and logistics resource.
The pandemic has hit some geographic regions harder than others. Sadly, some of the harder hit regions account for a huge chunk of global transportation and logistics traffic. This implies that most of the food shipping companies in Montreal must deal with limited capacities as well as unprecedented delays because there is a very slow movement of goods coming from places such as China, India, and even the United States. Even within regions or countries, the virus has hit some places or cities harder than others.
The areas with the highest impacts or those referred to as hot spots have seen a huge demand for goods such as foods, medical supplies, and other consumer staples. Regrettably, most food transportation companies can’t offer much help because either supply is not coming through from suppliers or they have put measures in place to protect their truckers, hence, a reduced flow of goods towards the most affected areas. Apart from the trucking companies not being able to push through with supplies, most companies, factories and distribution centers that serve the hot spot areas have shut down or reduced capacity due to the virus.
It is also important that we remember the health and safety of the transport and logistics staff, especially truck drivers and delivery personnel. It is a fact that some drivers may be unwilling to travel to the hardest-hit areas, and it is not fair for a company to force their drivers to work in places where they are afraid that they might contract the deadly virus. This has put additional constraints on an already maxed out driver labor market as well as the available trucking capacity.
The effects of the Covid-19 pandemic have left an imbalance in the supply and demand for trucking companies since freight coming from and into the high impact areas have gone down significantly. Most carriers are now forced to reposition their fleet or have simply resorted to a wait-and-see game. Consequently, there is a total disruption in the carrier transportation networks, causing a domino effect in the entire global transportation and logistics chain.
What can trucking companies do to stay afloat during the pandemic?
All hope is not gone that the virus will be controlled and the economy will open up so that normalcy can resume. In the meantime, however, there are certain measures that trucking companies can take to ensure safe, minimal, and efficient movement of goods so that they don’t have to close shop completely. Some of these measures include, but are not limited to the following:
1. Communicate with carriers to know their situation
Different companies were hit differently by the virus, and companies have also reacted differently to the effects of the virus. Freight forwarding companies can start by talking with their carriers to try and understand their situation and evaluate how that is going to impact business on their end. Together with the carriers, the freight companies can talk about mitigation strategies, areas of priority, current constraints, the impacts of the pandemic on the staff, and current capacities. There must be daily or even weekly communication cadences to ensure that both parties stay current and have the same understanding of the best way forward during this pandemic.
2. Conduct suppliers assessment
This is also the time for all transportation companies, including food transportation companies and medical equipment transport companies to conduct a careful assessment of their suppliers. It is important that you map out both the primary and secondary distribution centers and update your logistics plans, taking into consideration the government regulations on movement, distances, and possible lead times. It is also vital to liaise with the suppliers so that they advise you on their supply schedules and how the pandemic may have affected their operations. This is to help trucking companies align their operations to their schedules for maximum efficiency during the pandemic.
3. Stay updated on state and regional regulations
The pandemic has caused governments in other countries to impose curfews or cessation of movement in certain cities or regions. This may not be the case with your country, but you want to stay updated on the government’s regulations, especially on those touching on movement. Watch out for any travel restrictions or national emergency declarations that may mean zero movements for the fleet.
4. Consider alternative fleet strategies
This is also a great time to assess alternative fleet strategies to see if it is possible to repurpose the fleet for improved efficiency. Sadly, most trucking companies around the world don’t have solid strategies simply because disruption of this level in transport and logistics has never been witnessed. For example, explore the possibilities of having short term contracts with small third party trucking companies to help you out if operating your normal fleet during these times may lead to losses for your company. It is likely that you have a reduced capacity, and it makes economic sense not to commit your bigger trucks if you can get a smaller company to get the job done at a lower cost.
5. Perform a recovery assessment
The pandemic will be over some time in the near future. As a trucking company, you want to be ready to hit the ground running when that happens. With all the disruptions, that is not going to happen if you don’t have a proper recovery plan in place. Therefore, now is a good time to perform a recovery assessment and know exactly how you intend to resume normal operations post COVID-19.