Supply chain issues such as congestion, labor shortages, and increasing costs are not expected to be resolved anytime soon.
During the TPM 2022 convention the conversation circled around Russia and Ukraine’s effect on the supply chain; how it will unfold remains to be seen. Nariman Behravesh, the former chief economist with IHS Markit, stated that the war in Ukraine will have several and perhaps conflicting impacts on global markets and transportation.
It is understood ports, carriers, and inland terminals have been carrying some of the brunt of supply chain fluctuations. Recent increases in minimum wage and inflation in the oil and gas market are causing transportation costs to skyrocket for carriers and subjectively, their clients.
Merchandisers are preparing on the front-end by steering away from typical JIT inventory practices to account for the growth in demand that has continued over the last two years. The idea is to create the necessary inventory cushions to withstand future supply chain disruptions. Last year alone there was a 25% increase in demand for durable goods, which is “staggering” according to Behravesh.
Despite the uncertainty faced Behravesh believes, “As demand slows, and some supply problems begin to resolve, we would expect inflation to begin slowing down, probably in the second half of this year or early 2023.”
About GSC Logistics-
Headquartered in Oakland, California, GSC Logistics is a leading provider of high-volume, full-service shipping programs, including ocean and intermodal drayage, domestic and import/export cross-dock deconsolidation, overweight transportation, D.C. bypass programs, brokerage, and refrigerated and dry truckload services. Understanding the challenges commercial organizations face in resources, capacity, and scalability, GSC Logistics guides its clients through the complexities of supply chain and freight management logistics, helping them transform the way they do business.