In recent years, supply chain challenges have grown exponentially. Aside from dealing with an increasing level of demand, supply chains must also contend with growing port congestion and manufacturing delays.
These challenges were compounded by the increasing number of COVID-19 cases and certain extreme weather situations. Several countries known for being manufacturing hubs are halting production in several factories. These closures lead to many shortages that supply chains have had to overcome.
On top of that, the increasing reliance on online shopping has also seen a lot of business for organizations, but there have been a growing number of returns as well. These returns are proving to be a complex challenge for a supply chain that’s already under a lot of burden.
Consequently, it is easy to see the major trends that are going to dominate the supply chain industry for the next year. Below is a list of major supply chain trends that organizations can expect in 2022.
As was the case with 2021, it’s clear to see that 2022 is also going to be a year of logistical disruptions in the supply chain. There are currently several challenges that the supply chain is encountering due to the Covid-19 pandemic. With newer variants emerging, a lot of major trade ports remained closed, leading to significant delays in goods reaching several key markets.
These major logistical disruptions have a ripple effect on the global supply chain. The result is a supply chain that’s slowed down significantly and isn’t operating at its maximum capacity. That leads to businesses encountering issues managing their stock. Those businesses that rely on the import of goods are the ones that are suffering the most.
Many reports indicate that the festive season, December 2021 – January 2022, will be very different from the standard for shoppers. A lot of imported products that shoppers are used to seeing on shelves will be missing as the demand goes up significantly and the supply chain can’t keep up.
Organizations are trying to combat these issues by increasing their inventory storage capabilities to manage larger orders than before. They’re also trying to find innovative new storage solutions for returned goods. On the other hand, governments are trying to help promote production strategies that are more resilient to disruptions to the global supply chain. In other words, they’re trying to promote the production and use of local goods.
2. Increased Adaptability
Before the onset of the Covid-19 pandemic, production shortages and logistical shortages were rare events. However, after the pandemic, these events became headline news, with many markets experiencing shortages on many different products. Even the biggest organizations in the world weren’t ready for the supply chain disruptions that the pandemic would bring.
As a result, managers, and organizations have had to grow and increase their overall adaptability. The logistical delays forced managers to find more innovative solutions to supply chain disruptions, tweak their inventory management, and respond quickly to changes.
With most indicators pointing towards the fact that there will be more logistical disruptions and production delays in 2022, it’s likely that we’re going to see a much more flexible supply chain. In addition, as organizations start to put more thought into their production decisions and inventory management, the number of production delays will likely go down.
In an ideal scenario, the world will begin to open up again, and the supply chain will be all the better for it, having gained the ability to adapt.
As concerns about global warming continue to increase, with freak weather events causing regular disruptions in local supply chains, it’s clear that sustainability is going to be a key supply chain trend for 2022.
There’s greater pressure than ever before on organizations to clean up their imprint and adopt more sustainable practices. The same applies to the supply chain. As a result, organizations are now expected to think about how their product travels through the global supply chain and its impact on the environment.
These factors involve the sourcing of raw material, the overall production, and every form of transportation involved until the delivery of the final product. As such, organizations are starting to adopt more sustainable practices.
One of the main reasons why sustainability will be a key supply chain trend for 2022 is that it’s also good for business. As the number of environmentally conscious consumers continues to increase, the positive impact of adopting sustainable practices will also increase. As a result, a majority of consumers now prefer shopping from businesses and organizations that adopt more sustainable practices.
As the need for sustainability increases, supply chain leaders will continue to innovate and adopt more sustainable practices. One of the most common applications of sustainable technology is in transportation.
A key trend in perhaps every industry in the past few years, automation is still in its relative infancy when it comes to the supply chain. While some aspects of automation are involved, most of the global supply chain is still incredibly dependent on humans. However, as technology and robotics continue to improve, automation will likely continue to be a supply chain trend for the coming years.
Several leading organizations are already starting to realize the benefits of supply chain automation. Most of the machines involved in supply chain automation are targeted at increasing the operational speed and conducting more menial tasks. That will leave the human workers free to focus more on providing a better customer experience.
Many organizations are already benefitting from employing delivery drones and driverless vehicles to help streamline these logistics. In the future, these driverless vehicles and drones can play a key role in negating any potential supply chain disruptions.
As automation continues to be a supply chain trend, the future of the supply chain likely centers around digitization. The implementation of digital technology with a focus on increasing both the efficiency and productivity of the supply chain.
5. Increasing Presence of E-Commerce
While most industries have been struggling in recent years, one that continues to show consistent growth is e-commerce. As people are spending more of their time at home, the number of people who engage in e-commerce is increasing exponentially.
Not only is the number of consumers increasing, but the number of e-commerce businesses is also increasing at a rapid scale. As a result, e-commerce logistics is starting to become an ever-present part of the global supply chain.
An organization that employs good e-commerce logistics will help optimize the transport process and provide real-time updates at the same time. One of the key areas of e-commerce logistics is digital fulfillment. Consumers will always know where the product is while they’re waiting for delivery through the digital fulfillment process.
6. Productivity Techniques
Even though automation will continue to be a key supply chain trend, the main core of the supply chain is entirely dependent on human workers. That is why a focus on techniques to help improve productivity will be a consistent focus for supply chain managers in 2022.
One of the most common productivity techniques that the supply chain can adopt is gamification. As a result, gamification is becoming increasingly popular among sales and marketing teams while providing exceedingly positive results.
It involves the implementation of game design strategies that can help improve the productivity of all the human workers that are a part of the supply chain. In addition, through gamification, organizations will be able to instill a sense of healthy competition between the warehouse workers and increase their overall productivity.
Aside from helping increase productivity, it’ll also give organizations a better inkling of their best-performing employees and allow them to reward them appropriately. Several other productivity techniques can greatly benefit the supply chain in 2022.
7. Blockchain Technology
Cryptos and NFTs might be making all the headlines recently, but several other industries can benefit from blockchain technology. For example, by using blockchain, manufacturers and distributors can improve their delivery process making it more efficient and fraud-proof.
You can expect to see an increasing number of manufacturers and distributors adopting blockchain technology in 2022. Blockchain will help improve and streamline communication between different actors in the supply chain. At the same time, the security will help ensure that there can be no form of tampering or external influence.
While it might not make a lot of headlines, fraud is still a common issue that holds back several different supply chains. By using blockchain technology, organizations can help eliminate fraud and make the supply chain much more transparent.
These are the key trends you can expect to dominate the supply chain industry in 2022. However, given the volatile nature of global trade at the current moment, there can be new developments as we move forward through the year.
If you want to learn more about how to build a more resilient supply chain, click here to schedule a meeting with Integratz. We help organizations streamline their logistics and optimize the