This past year proved as unpredictable as 2020. Supply chains were buffeted by unprecedented increases in demand, significant bottlenecks, and capacity constraints across virtually all transport modes. Adjusted for inflation, retail spending has increased 14 percent over the last two years in North America; that’s more than in the previous seven years combined, according to an October 2021 report from The New York Times.
This sudden growth in demand and subsequent supply constraints exponentially increased variability in global supply chains. Traditional solutions like increased buffer stock, sourcing new suppliers, and increasing destination warehouse space in many cases were not available.
Some shippers have chartered vessels to ensure their shelves are stocked, but the supply chain has many actors, and all those actors must work together, especially in time of disruption. The tenet “a supply chain is only as strong as its weakest link” has been on full display for all global businesses.
However, 2021 also strengthened the digital transformation that started in 2020. One new solution offers hope for a task all importers and exporters work through: customs clearance. Visibility, transparency, and digitizing data hold promising potential within this space.
The past year has prompted many customs authorities to explore digital documents, underpinned by blockchain, to improve the quality of risk assessments and mitigation. Clients have also realized the benefits thereof, such as earlier visibility into the clearance status of goods, sometimes up to six weeks earlier than with previous paper-based processes.
Taking current variability as another impetus for change and adding the desire of customs authorities to embrace new ways of solving old problems means there is real potential for shared efficiency gains across the entire supply chain ecosystem. We look forward to that future in 2022. Collectively, we can make global trade easier, more efficient, and more secure for all!