We’ve just about hit the official one-year mark since the onset of the pandemic and the surge of disruption that came along with it. Essentially every sector in the logistics arena was confronted with two primary options when COVID-19 reared its ugly head: adapt or close shop. 

To avoid reiterating the same story all over again (for what probably feels like the thousandth time), we sought to understand where manufacturers stand in the environment notoriously dubbed as the “COVID age.” Painting this picture requires an expert pair of eyes that fully understand the intricacies along with obvious uniformities. We hand-selected BDP’s Global Vice President of Sales Supply Chain Solutions, Randal Holtzapple, to walk us through where manufacturers are now and how they can successfully continue operating amid an environment where seismic pressures and shifts are becoming the standard.

Holtzapple highlights significant shifts and their impact across the supply chain.

“What started with factory shutdowns in China in the first quarter of 2020 has resulted in ocean carriers bypassing major shipping ports,” he says. “Blank sailings have led to equipment imbalances and a lack of ocean shipping equipment at key ports in China and throughout Asia. Manufacturers are focused on getting their ocean containers booked and the container movement out of Asia. This is the first shift we’re seeing within the industry.”

He goes on to explain that the same increase in demand that haunted the ocean transportation sector at the onset of COVID-19 continues to be a major issue for handling capacity. This paired with the seemingly endless equipment shortage has forced some customers to seek alternative partnerships for a solution. 

For BDP, Holtzapple affirmed the company is seeing a pattern where customers with long-standing relationships with ocean carriers are now relying on their business, other 3PLs and freight forwarders to overcome challenges with bookings. 

“The second main shift evident is the request for expedited clearance and movement of cargo upon arrival at U.S. ports, as most containers and air freight shipments are arriving later than planned,” Holtzapple explains. “Many companies’ inventories have been depleted. For now, getting products for materials out of Asia is their lifeline.”

Keeping customer needs as a priority goes beyond measures taken when chaos ruled the logistics world in 2020. What the industry is seeing now is a new approach to operations with international partners, new resources, and new compliance checks and balances.

“The third shift that we’re seeing is the need to have logistics and trade solution partners versus providers that are offering the lowest cost for transportation movement,” he explained. “In the COVID environment, it’s not just about moving product from one port or airport to another, it’s about how these partners can move the product safely from new sourcing locations, compliantly. The most significant element of this shift is the focus is no longer on the lowest-cost provider. Now, it’s focused on the company that can bring the mentioned capabilities and partner with the manufacturer.” 

Thankfully, we live in an age where technology seems to always come sweeping in to save the day, albeit expensively and complexly. The key to optimizing the blend of technology and solutions is found in understanding what the customer needs are and thinking outside of the box. BDP’s experts are no strangers to this. Providing an open line of communication while supplying an array of tools and partner connections creates a resilient network the customer can depend on. If you’re not already doing this, your competitor most likely is. Holtzapple explains that having a trusted logistics partner is key for maintaining a competitive advantage while retaining customer loyalty.

“BDP offers customers several technology platforms for support, especially in the COVID world,” he says. “BDP Smart is our web-based visibility tool where customers can gain instant access to sensitive documents, track their shipments, and inventory, and rely on up-to-date information on their global booking requests and vessel schedules. An application within BDP Smart is Smart Vū, and it serves as an all-inclusive technology solution for vendor management and supplier logistics. The third solution introduced in 2020 is our self-service platform, BDP GO. This technology simplifies, streamlines and allows for digital booking of shipments.” 

The common denominator with BDP’s solutions portfolio is customer support via reliable, accurate innovation. This strategy will continue to separate the weak and the resilient throughout 2021. Beyond the platform solutions and options for data integration, refining high-level business strategies are a must. 

“The challenges caused by COVID have been a catalyst for companies to rethink and energize their global supply chains,” he said. “To remain competitive in today’s marketplace, manufacturers are taking a broader approach to the selection of logistics and transportation providers.”

Holtzapple highlights four major strategies companies are currently implementing to maintain a competitive position within the industry while retaining customers long-term. These measures are proving to be effective, despite the myriad of disruptions felt in the last year alone.

“The first strategy is the diversification of suppliers,” he says. “Companies are looking for providers that can bring solutions and innovation to their global supply chain. While costs will always remain important, companies today are looking for partners that can provide technology and innovative solutions to enhance and bring efficiencies to their supply chain.”

He explains the second strategy is simply found in the revisiting of global sourcing strategies. Regional sourcing has become the new trend, providing nimble options while recreating a dependency on sources beyond China and South Asia. 

“Companies have been crippled due to the challenges of COVID in China and Southeast Asia,” Holtzapple says. “Now more than ever, companies are looking for regional sourcing or near sourcing solutions. When a company can’t get materials out of parts of the world, the impact is significant to their overall bottom line.”

The need for supply chain visibility is the third strategy, he says. “The one thing this pandemic brought forward is the need to continue looking at solutions with technology and transparency. The goal is to break through the barriers and silos that exist and bring visibility across all business functions within an organization. Once you do that, you allow for better planning, collaboration, and optimization.”

Holtzapple cites contingency planning and sustainable business practices for the fourth and final strategy on his list. Manufacturers can no longer afford to not know where vulnerabilities are present. Instead, the need for proactivity is amplified to ensure risk mitigation efforts prove effective. This applies to workforce management just as much as it does to operations. 

BDP’s Global Vice President of Sales Supply Chain Solutions also brings to attention the seemingly foreign concept of flex workers in manufacturing. Many companies are faced with this discussion for the first time. This and other parts of the logistics equation require forward-thinking contingency planning measures to ensure the best outcomes.

“It’s safe to say that nobody’s been immune to the challenges and the impact of COVID on the global supply chain,” Holtzapple says. “Whether companies are looking to better align with strategic partners, reduce dependency on risky sourcing areas and/or re-evaluate their just-in-time inventory strategies, building a more resilient supply chain is the key lesson learned. 

“The other important thing to remember is embracing and a continued commitment in technology investment. Technology can bring transparency and foster collaboration across different business units resulting in more efficient and timely decision-making. This is key.”

____________________________________________________________________

As global vice president of Sales Supply Chain Solutions at BDP International, Randy Holtzapple is responsible for creating diversification and a go-to-market strategy and overseeing a team of sales directors who are focused on selling complex supply chain solutions to large multinational companies, including some of the largest retail, consumer products, chemical and industrial manufacturing businesses in the world. Prior to joining BDP, he held a variety of managerial and sales leadership roles at other large logistics firms. He believes strongly in giving back to local communities and serves on the Board of Directors for Junior Achievement of Central Indiana. He can be reached at randal.holtzapple@bdpint.com.