Georgia Gwinnett College recently issued the following announcement.
While it’s no secret that ports around the nation are dealing with a logjam of ships vying for the next turn to be unloaded, Dr. Sanjaya Mayadunne says there’s a light at the end of the tunnel and it will come sooner than we think.
Mayadunne, who is an associate professor of decision sciences and management information systems at Georgia Gwinnett College (GGC) and supply chain expert, said it all boils down to expectations.
“People have grown accustomed to the efficient ebb and flow of shipping supplies and products, constantly ordering and receiving those orders in two days thanks to the advancements in supply chain design and operations over the last decade,” he said.
Mayadunne explained that companies like Amazon, whose Prime members in pre-pandemic times enjoyed the benefit of overnight shipping, have trained consumers to expect that consistent efficiency post-pandemic, which isn’t necessarily sustainable.
Looking at it from a technical standpoint, these supply lines depend on the basics of the economy, supply and demand. The more demand rises, the more supply must rise to match it. Current demand has skyrocketed as the nation is trying to recover from the pandemic and people everywhere are trying to purchase products, while there just aren’t enough people and resources to support the supply chain. At a time when an infusion of labor is needed, 2.9% or 4.4 million workers in the United States left their jobs in September.
The situation has created a “perfect storm,” but Mayadunne said to expect improvement in 2022, perhaps as soon as January.
“If things go well, we could be looking at significant improvement once the holiday season is over and the pressures on the demand side ease somewhat,” he said. “Getting back to a pre-pandemic normal will take longer.”
Although there are some current issues with grocery items, Mayadunne says this is temporary.
“The holiday season appears to be impacting the availability of grocery items – which goes back to the supply and demand,” he said. “But I don’t think groceries or amenities will be affected heavily in the long term.” He said that more complex items, such as game consoles and other electronics, may continue to feel the full brunt of the shortage into next year, but it’s not all bad news.
President Joe Biden recently signed a $1.2 trillion infrastructure bill that, along with helping shore up the weaker zones on highways for land transport, dedicates several million dollars to ports like the Port of Savannah. This funding will help to establish new stockyards and train new employees for those yards. The process may seem slow, but the system is working itself out.
When asked how long dozens of ships may remain anchored outside of the nation’s ports, Mayadunne was hopeful.
“One of the reasons for the bottleneck at the ports is the inefficient use of resources. For example, there is a limited pool of truck chasis available to truckers moving containers out of the ports in Southern California. In the past, chasis were used and returned to the pool in four to five days. Currently, this cycle averages nine days,” he said. “I believe as demand eases, we will see better planning and more efficient operations. While I wouldn’t say our supply chains will reach a pre-pandemic normal for a while, we will eventually fall back in line with normalcy.”
Original source can be found here.
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