Major Problems Of Global Supply Chain and Modern solutions to fix them

With the rapid development in technology and IT-related services, the demand for transport and services is at an all-time high. Therefore, the global manufacturing sectors contribute the largest share of the logistics sector. However, during the covid breakout, the global supply chain got massively disturbed. We see several shipments getting delayed or stuck somewhere for a long time because of restrictions. 

Additionally closing of the majority of manufacturing companies because of the unavailability of laborers kept businesses at a loss. However, the companies learned a lot during this pandemic and realized that an efficient logistics system is highly needed. This made the organizations develop innovative solutions to boost the supply chain framework. Similarly, we have a host of remedies to overcome the global supply chain challenges using sophisticated software solutions. 

1.Production and shortages 

During the pandemic, we saw a sudden dip in the working force in major industries. Most of the small and medium business organizations were facing acute shortages of cargo. On the other key positions, manufacturing positions remain vacant during the period of covid too in the Whole year 2021. 

As per the news report of Forbes, there is a massive impact on the manufacturing business as only the essential items are in production during the pandemic while other goods are on the verge of dissolution. 

Solution  

In findings by the executive of demand and supply, most production companies concluded that it is time to diversify the supply chain. In other words, we need to use technology to track the trends, and diversification will not allow production to come to an absolute halt. While current IT services and blockchain help in coordination between interdependent suppliers.

In order to ensure that the data in the data warehouse is correct, secure, and guarded against unauthorized access or tampering, organizations can utilise ETL to create data governance and security measures. Partnering with a logistics software development company can also enhance these measures, providing advanced solutions for data management and supply chain efficiency. Organizations may ensure that their data is trustworthy and dependable by putting these measures in place.

Additionally, Data warehouse and ETL consulting services can assist organizations in enhancing their data management capabilities. Organizations can establish a single, consistent view of their data that is simple to access and analyse by integrating data from various sources, cleaning it up, and changing it. On the basis of their data, this can assist organizations in gaining insights and improving their business decisions.

2.Growing transportation expenses

As the world is going through indirect inflation, transportation costs are at an all-time high. Or the fuel prices or taxes & management fees have increased only. Therefore, the cost of freight and other miscellaneous charges makes the global supply of goods at the maximum operational cost. Whether you need help with inventory management, transportation planning, or order fulfillment, our logistics software development services can help take your business to the next level.

Solution  

Try to integrate commodities and reference data in one place as much as possible to reduce the overall processing time and expenditure per item. Additionally, prioritize the local or imminent vendors nearby your production house to keep the expenses low. Whereas taking double consideration and having your alternative options ready so that you don’t get your materials came to a standstill.  

3.Port Traffic 

Increasing logistics and trade have congested our major ports. As a result, sea traffic is now a bigger issue that delays shipments and increases the cost of products for business organizations. Additionally, factors such as natural disasters, bad weather, malfunctioning of port mechanisms, etc., are significant contributors to port congestion. 

While other issues that kill time at ports are lack of proper container space, outdated loading-unloading machines, international disputes, etc. are also significant contributors to port traffic. Additionally, some ports have a history of enduring labor strikes that might become a substantial concern for supply chain services. 

Solution 

Modern problems require modern solutions, so we have to follow the mentioned points to save time at the busiest ports. 

1. Prefer onshore suppliers to bypass distant as well busiest ports. 
2. Use Artificial intelligence to find alternatives for rerouting at nearby lesser crowded ports. 
3. Always be dynamic in inventory policies to fulfill port requirements. 
4. Implement a three-way matching process to track down your logistics accurately. 
5. Try to elongate the lead time to get enough days in your hand. 

4. Demand forecasting in logistics 

Demand forecasting in logistics accurately predicts the supposed demand for products and shipments. Companies use a slew of techniques to attain this data. Different from the growing transportation business in the age of globalization, getting precise data for profitable operations is becoming more challenging. 

The major reasons behind the increasing failure of speculative data are untimely drops or surges in demand, highly competitive players, sudden changes in vendor requirements, etc., creating inaccurate safety stock. 

Solution 

1. Technology improvement will lead the management to work at full capacity by keeping the containers full during every transaction. 
2. Invest in Artificial intelligence to reduce the overall cost of logistics operations by optimizing the demand forecast data and pinpointing the required information. 
3. Use correct data analytics for the employee to feed it for correct and timely prediction. 
4. Use contemporary solutions such as artificial intelligence as it uses the data diligently to foretell about multiple origin destinations simultaneously. 

5. Supply chain fragmentation 

In the major manufacturing chain, the suppliers are spread across different parts of the world at every stage of this process. This makes the shipments add a variable value of shipments at every stage. 

For example – Multiple vendors are located in different countries for the production of the Apple iPhone. As the parts are resourced from nations such as China, Taiwan, Thailand, Malaysia, etc., using the fragmented supply chain, all these parts are assembled in countries like India and China.

But during the covid year, we saw a significant loophole in the system as if shipment from one country stopped the whole functioning of the supply chain network came to a standstill. 

Solution 

The only practical solution to reduce the malfunctioning of supply chain fragmentation is the effective use of data. I prefer the vendor and systems that are highly in sync with each other and disregard the ill communication gaps between them. Additionally, find the loopholes with careful observation through your logistics management team to prevent any possibility of delay. Another great option is to use conclusive data analysis using cloud-driven solutions for accurate results. 

I hope you got enough information regarding the modern-day worldwide logistics challenges and solutions on how to tackle them effectively.