Coronavirus has paralyzed life and affected businesses scattered all around the world. It has made a great impact on the world economy as many people have lost their jobs and livelihood in various sectors. The growing danger of this virus has created a serious risk to cold storage and supply chains, and retailers have had to face the possibility that the suppliers will halt production fill-up and reduce the stockpiles.
Established warehouses have been built near big cities on the outskirts where industrialization has occurred. The main reasons for these warehouses being located on the outskirts are the availability of cheap labour, taxes and space at a lower cost. Here we refer to the major warehouse’s chemical companies, machine manufacturers, and boiler, etc. for maintaining their spare parts and raw materials. A logistics company implements, plans, and controls the storage of the movement of goods. These logistic chains are going through massive and unusual losses from the disruptions caused by the pandemic. Most of the companies hire these warehouses on lease. The benefits of this are no labour commitment or long-term investment.
Before COVID-19, the challenging task was related to the availability of labour to work in the warehouse. However, as shown in the media migrant workers are going back to their hometowns making staffing even more challenging and affecting the freight companies negatively in the long run. In addition, ports have been closed during the quarantine periods and the entry of vessels by certain countries has been restricted which has caused chaos among the marine transportation facilities all over the world.
The import and export of goods between countries has decreased dramatically. The goods that are transported by ships or other marine vessels have to follow new stringent rules and procedures which has led to less demand for the cargos. For this reason many small companies that are involved in the shipping industry have gone bankrupt.
Apart from the issue related to the availability of labourers, there are other potential challenges for warehousing service providers when they reopen. Operational cost is marginally met with the inflow. There will be tremendous pressure to cost-cut expenses. Fixed costs such as electricity, office administration, IT development expenditures will be very difficult to manage. The cash flow is also affected as there may be huge delays in the payments made by the customers as well as the customers asking for reductions in fees.
As we see now the lockdown will not continue for long and slowly industrial operations will have to be up and running. If not, the economy which is already derailed might collapse. This pandemic has created a massive disruption in the food industry which has resulted in an increased demand for the cold storage warehouse space. More customers are ordering things online, which increases the demand for cold storage capacity.
This pandemic has exposed the major weakness of the supply chain: mainly the inability to react on a large scale and sudden disruptions. The following are the rules that must be followed in order to have a more resilient supply chain model:
- The organizations should understand the needs of the healthcare and workforce both during and post pandemic. The operating personnel which includes helpers, housekeeping staff, security, packers and pickers, supervisors, and managers should be trained to operate in the light of the COVID-19 pandemic. They have to follow the do’s and don’ts at regular intervals and constantly.
- Organizations should make sure that the personal hygiene requirements are met which includes masks, shoes, goggles and hand gloves, etc. – it depends on the nature of the materials being handled. There should be a temperature check for every individual through the remote thermometer gun at the time of both entry and exit. Social distancing should be maintained.
- Software can be used for maintaining social distancing to control the flow of vehicles at docks of the transport goods to avoid the crowding of individuals and vehicles. The truck drivers should be educated with personal hygiene practices.
- Adopting technologies such as sensor tags, cloud WMS, IoT and mobile tracking will enhance the overall warehouse operations and improve efficiency in every step of the cold chain process. Automating the cold chain process is the key to respond to challenges like the coronavirus pandemic. It helps your company improve efficiency in the short and long run, which improves productivity and business growth.
- There should be visibility across the supply chain. Doing this provides the customers with transparency and effective supply chain strategies. The monitoring and alerting will help in identifying disruptions and, as a result, the supply chain team can respond immediately to reduce the disruption before it turns into a problem.
It is a very challenging task to respond to a global pandemic situation. Companies should revisit their supply chain strategies, should adopt warehouse management technologies and should implement supply chain risk management and business continuity strategies. Cold chain companies should adopt the digitization and automation in order to increase business efficiency.
- Posted by admin
- On September 8, 2020