• January 11, 2024

Impact of COVID – 19 Pandemic on the Logistics Industry

Logistics firms, which are involved in the movement, storage, and flow of goods, have been directly
affected by the COVID-19 pandemic. As the pandemic spread to the rest of the world, it led to
lockdowns and border closures – this aspect restricted the movement of goods. Additional protocols
such as social distancing created bottlenecks for logistics / project
forwarding services.

Supply chain disruptions caused by the pandemic have impacted the operations, competitiveness, and
economic growth in this sector. It has led to delivery delays, congestion, and higher freight

Challenges encountered by logistics companies:

Air Freight Forwarding Services

Volumes fell by 30-50 percent in March 2020 due to a sharp reduction in passenger flights (which
carry freight as belly cargo). With all aircraft grounded and most flights canceled, the market had
to deal with supply shortages. On that same note, the tightened health inspections have only led to
more delays.

Ocean Freight Forwarding Services

The ocean route which is considered the cheapest alternative means of transport has also felt the
impact of the virus. Most shipping lines have inventory issues with lot of delayed bookings,high
unexpected charges & roll overs.Imports from China has reduced drastically putting major pressure on
export inventory Ex-India as well.Transit ports like Colombo,Singapore have great embargos which
delays shipments futher.Suez Canal incident has added to the fire as well.

  • Land Freight:
    Globally the roads have remained in operation, except in countries
    where there are severe lockdowns. As a result, ground transportation services have remained partially
    available, unlike ocean and air transport. However, due to reduced employee availability and an
    increase in demand for essential services— like food and medical supply transportation, other
    economic essentials that require land transport, such as manufacturing, are generally not at
    full capacity – mainly because of the restrictions and lockdown.
  • Workforce and Labor:
    With increased state/country border health checkups and
    restrictions, vehicle drivers and other transportation staff are now required to get a permit to
    operate. And in a bid to meet the required demand (essential goods), many logistics businesses
    have ended up overworking the healthy and efficient drivers/staff. While the remaining
    percentage who are ill or infected have been forced to stay at home to ensure everyone’s safety
    and wellbeing. This has resulted in a shortage of workforce and labor – which has further put a
    strain on logistics and delivery of goods.
  • Businesses Players – Small/ Large Companies
    Higher air cargo freight rates,
    delayed sailings, and longer road transit time has hit several businesses. While the full effect
    of the pandemic on global supply chains is not yet known, as per reports, the impact is severe
    for small business players. Small businesses are being severely hit because they tend not to
    have any recovery plan, backup, or alternate operation plan. Lack of technology, as well as
    tools to follow health guidelines further complicate their operations. Whereas, large companies
    with a diversified business (those serving different sectors, having multiple clients in various
    regions/countries) are in a better position to withstand the current storm.
  • Role of Warehouses During the Pandemic
    The role of warehouses will continue to evolve. While some storage is being used by other parts of the supply chain, the critical goods and materials, like ventilators, alcohol sanitizers/ face masks, will need local storage in the
    future as well. Logistics systems need to be capable enough in handling these huge global shifts
    – both in terms of consumption habits and delivery capabilities.


Strategies to Solve Some of These

According to studies, the following strategies are laid out to solve some of the logistic

  • Airlines to embrace the cargo way
    In order to deal with the pandemic situation, most
    airline companies have redesigned their passenger planes to act as cargo planes. This aspect
    will help the airlines keep their profits high. Moreover, it will provide employment to some of
    their workers.
  • Collaborative efforts
    Some suppliers have decided to share the costs. For example,
    most manufacturers have agreed on sharing the storage costs on containers during shipments. This
    joined collaborative effort will help both businesses as well the project forwarding services to
    stay operational – even with low volumes of work.
  • Implementation of emergency strategies
    The constraints facing by most logistics
    companies have now led to the adoption of “What if” strategies. Logistics companies in Mumbai
    and all over the globe are urging their emergency risk management team to find out ways to
    tackle such situations in the future.
  • Efficient use of technology
    To curb the spread of the virus, most logistics
    companies are now seeking tech-driven solutions. Companies are now investing in the Internet of
    Things (IoT), cloud computing, automation, and data analytics. So in the long run, robotics,
    drones, and autonomous vehicles might ease up the task of logistics services providers’, in case
    there is a shortage of staff/labor.
  • Safety protocols
    To protect the staff’s health, some companies have introduced
    safety protocols like social distancing at warehouses, disinfecting work areas, etc. Some are
    even investing in PPE kits and protective gear – so that employees stay safe while functioning.
    While these efforts, lead to higher financial costs, it can definitely help the service/business
    sustain for a while, instead of collapsing completely.Logistics companies are facing huge challenges due to the COVID-19 pandemic. However, as human
    beings, everyone is resilient enough to work through most challenges thrown at them. So as of
    now the success of logistics companies will depend on what contingency planning and strategies
    it uses to move forward in the game. Logistics/ project freight forwarders will need to
    collaborate and optimize as much as possible to operate safely, efficiently, and pre-emptively.
    Moreover, it will require businesses and consumers to adjust, improvise and innovate rapidly.New Globe Group is one such company that aims to provide effective logistic services – be it in
    any situation. This firm offers project forwarding services, air freight forwarding services,
    ocean freight forwarding services
    , logistics services, customs brokerage services, tracking &
    tracing service, consolidation services, perishable/ dangerous goods packaging services,
    warehousing, ground transportation services, etc. Empowered by a talented and enthusiastic pool
    of executives, the firm offers services in compliance with the set industry guidelines.

    If you are looking for a budget-friendly logistics service in Mumbai – look no further than New
    Globe Group. The team will help you meet your varied demands – be it any day.

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