The supply chain disruption is expected to last well into 2022. Here’s what the experts are saying.

The transportation and logistics industry has been facing a myriad of issues due to the supply chain disruption. From higher shipping prices to container shortages and staffing problems, companies have been struggling to get their products shipped on time and within budget. While many measures have been taken to mitigate these concerns, the supply chain disruption is expected to last well into 2022 and likely into 2023 as well.

Here’s what you need to know:

Understanding the problem

While the pandemic is widely blamed for causing supply chain issues, some experts believe the problem goes back even further than that. According to Mark Baxa, the Council of Supply Chain Professionals interim President and CEO, the disruption stemmed from increased tariffs on Chinese goods in 2018.

Due to these tariffs, some suppliers started doing business in other countries, such as Indonesia, the Philippines, Vietnam, and South Korea. This shift caused infrastructure challenges, trade compliance problems and legal headaches that affected a variety of companies, according to Baxa.

The pandemic exacerbated an already stretched supply chain through lockdown measures, container shortages, and increased demand, which, for many manufacturers and shipping companies, came as a shock.

At the beginning of the pandemic, as Covid-19 measures were put into place, it was assumed that demand would decrease, which is why companies slowed down production.

Once demand spiked for a variety of products, manufactures and shipping companies couldn’t keep up. At the same time, a transportation bottleneck in Europe and North America was created due to labour shortages, incidents like the Suez Canal, (when a vessel got stuck and blocked the waterway for a week) and, more recently, higher gas prices and the conflict in Ukraine,

This disruption led to higher shipping prices, logistical nightmares and longer wait times for companies and their clients.

How technology could help

While the transportation and logistics industry is desperately trying to repair a broken supply chain, industry experts and economists expect lingering issues well into 2023. There aren’t any easy solutions, but a tech boom could help.

Experts believe that, in the next five years, the transportation industry will see substantial advancements in tech, which will improve complex logistics issues and increase communication among all parties.

This shift should help boost efficiency. For some companies, it can take as many as 20 steps to get a truck from one place to another. This includes communicating with the shipper, receiver, third-party logistics companies, the carrier and the driver.

Because of this, some businesses are already switching to cloud-based apps for freight management and building routes. This makes communication between parties easier and faster and decreases the amount of work needed to get goods to their target location.

Looking to the future

The supply chain disruption has affected many companies at all levels. With higher gas prices, expensive shipping options and demand that’s higher than supply, experts aren’t seeing an end to this problem in the near future. Still, shipping and logistics companies are working hard to improve communication, increase efficiency and get products where they need to be.