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The coronavirus pandemic has affected many parts of everyday life and numerous industries, especially tourism, hospitality, and restaurants. The logistics sector also faced many new challenges and is evolving organizationally and technologically. Maintaining efficient transport flows despite the new conditions has become an art form.
Regulatory responses to the Covid-19 virus have involved restrictions and quarantines that have impeded the free movement of goods in both local and global markets. It was only a matter of time until new approaches to supply chain management were implemented in response to the so-called “covid laws,” which included lockdowns and official programs to support entrepreneurs.
The decrease in cargo transport volume was associated with the increased difficulty of delivering goods from senders to final recipients in a timely manner. The ability to adapt to the “new reality” has become critically important. A logistics company’s financial stability has been directly related to the depth of its service portfolio, presence in multiple markets, and ability to find innovative solutions to new challenges.
Logistics companies have developed more specialized offerings to support businesses in certain industries like, for example, automobile manufacturing. In Europe, car makers have experienced difficulties caused by closed factories that have led them to invest in new industries and markets. Diversification and local market presence have also become more important.
China is expected to remain the dominant link in global supply chains. Local distribution became increasingly important, however, when some Chinese factories were closed temporarily and many components were not accessible. As a result, many customers began to look for local storage options to minimize the risks of such situations in the future.
Interest in buffer warehouses has also grown. More companies than ever are looking for additional storage space to meet their requirements for six months to a year in advance. This approach is primarily seen with companies that import goods from the Middle Kingdom. The new logistics solutions are aimed at effectively managing trade restrictions.
Mariusz Borkowski
“We have noticed the growing ‘Europeanization’ of suppliers. Partners from Europe are replacing Chinese contractors. As a consequence, this will lead to greater demand for space in smaller local warehouses,” says Mariusz Borkowski, AsstrA Poland Regional Country Manager.
The coronavirus pandemic has not caused transport service providers to entirely shut down. The overall transport industry, however, has undergone significant evolution. During the quarantine period, air transport became 4 times more expensive than before the pandemic. However, medical and hygiene products continued to be promptly transported by air.
“We have seen considerable demand for intermodal services. ‘Shooting galleries on rails’ and containers are considered environmentally friendly due to their low carbon dioxide emissions. They also do not require drivers. The intermodal boom is confirmed by statistics related to The Value of a Statistical Life: domestic intermodal traffic grew by 27% in Germany and 39% in Poland,” says Mariusz Borkowski.
The digitalization of logistics processes is accelerating. The e-commerce market is breaking records and couriers are rolling up their sleeves. However, this is an indirect effect of Covid-19, as buyers increasingly interact with sellers online. Similarly, companies now rely on teleconferencing and video conferencing more than ever. Keeping operating costs down remains the biggest challenge so far.