Industry Leaders Discuss Navigating the Supply Chains

Keywords:Trucking

Several factors are affecting the fluidity and stability of the global supply chain in the current environment. Many of these factors will likely prove transitory, but it’s still a challenge for businesses to navigate through them.

We’ve seen West Coast imports rise 11% in 2021¹ compared with pre-pandemic levels. The Ports of Los Angeles and Long Beach, which represent 65% of West Coast imports¹, were up 18% in 2021¹ and are on track to set another record this year. Consider that this occurred when the industry was dealing with pandemic-related operating protocols, health-related worker absenteeism, driving school closures resulting in fewer truck drivers, and an ongoing shortage of truck drivers. Not only is it difficult to grow the supply chain in line with demand, these factors also slowed the velocity of the supply chain, further reducing supply.

This has been the vicious cycle the supply chain has been dealing with for the past two years. At the heart of it is demand stimulated during the pandemic that cut into the availability of supply, resulting in a massive supply-demand imbalance. Businesses have to deal with these issues and the resulting inflationary pressures.

With time the supply chain will normalize, but there are fundamental changes taking place that will permanently affect supply chains, including the rise in e-commerce’s share of retail sales, which is reshaping how we consume; freight transportation; the need to increase supply chain security and diversification; and an increased focus on the supply chain’s environmental footprint.I recently moderated a panel of industry leaders to provide insights into the current state of the supply chain. They discussed how their companies are dealing with these challenges as well as the opportunities that lie ahead.

Derek Leathers is Chairman, President and CEO of Werner Enterprises , a transportation logistics company. The company is the largest cross-border freight carrier into and out of Mexico. Leathers said about 65% of Werner’s business serves the retail market.

Phil Yeager is President and COO of Hub Group , a provider of end-to-end supply chain solutions, including intermodal, truck brokerage and logistics services. The company maintains over 51,000 containers and about 3,500 truck drivers.

Jonathan Ahdoot is President of Hardware Technology Solutions at Hypertec Group , a global IT solutions provider. Hypertec designs, builds, deploys and supports computer hardware with a primary focus on servers and storage devices for more than 3,000 customers and 450 data centers in over 80 countries. The company sources components and subcomponents from China, Taiwan, Japan and Singapore, as well as North America and Europe.

A labor shortage, particularly among truck drivers, has been a key factor behind the current inefficiencies in the supply chain. Meanwhile, inflation is putting pressure on labor and fuel costs while also changing consumer habits. Our panelists discussed how they’re navigating these issues.

Our panelists detailed some of the ways they’re using technology to improve efficiency in everything from container tracking to billing. They also discussed how they’re meeting ESG goals in areas such as emissions reduction and corporate transparency.

The panelists provided a wide range of insights into how their companies are handling the issues that affect this crucial industry. Listen to the full discussion here.

¹BMO Capital Markets Estimates & LA/Long Beach Port