Outsourcing logistics is no longer as straightforward as it once was.
Businesses may need to make compromises on their demands and be prepared for a lengthier process.
Join us as Urszula Kelly sheds light on the current challenges in logistics outsourcing and explores how these obstacles are affecting the industry today.
Check out the video below for a deeper dive.
Rob: This week, we’re focusing on logistics outsourcing, a tough area for many organizations right now. Ursula Kelly, one of our experts, will shed some light on why it’s becoming more challenging. It’s great to have you back, Ursula!
Urszula: Thanks, Rob! It’s lovely to be here.
Current Challenges in Logistics Outsourcing
Rob: You’ve been deeply involved in logistics outsourcing over the past 2-3 years. Is it getting harder? What are the current challenges?
Urszula: Yes, it’s definitely getting harder. There are several reasons for this. The first big issue is the shortage of people. We’re missing drivers, warehouse staff, and admin workers. This shortage complicates smooth operations.
Equipment Shortages
Rob: And what about equipment?
Urszula: The second problem is equipment shortages. You used to be able to buy trucks quickly, but now the wait is 18 to 24 months. This delay impacts our ability to meet the high demand for transport and other services.
Increased Consumer Spending
Rob: What about consumer behavior?
Urszula: That leads to the third issue: increased consumer spending. Even though the economy was expected to slow down, demand remains high. This discrepancy puts additional strain on logistics.
Consequences for Companies
Rob: What are the consequences of these challenges for companies?
Urszula: Companies are often forced to adjust their demands and compromise on ideal providers. Instead of finding perfect solutions, they must work with what’s available and adapt their requirements accordingly.
Top Tips for Outsourcing
Rob: If someone is looking at outsourcing, what are your top three tips?
Urszula: First, set realistic expectations about what can be outsourced. Second, allow extra time for finding the right provider. Third, make sure the person handling the tender process understands the current market conditions.
Dive deep into this topic by watching the video above.
Related articles on this topic have appeared throughout our website, check them out:
- Struggling with Logistics Challenges? A 3PL Might be Your Salvation
- Insourcing or Outsourcing Logistics: Don’t Choose the Wrong Reasons
- 6 Quick Tips for Successful Logistics Outsourcing
- Logistics Outsourcing Partnerships and Why It’s Time to Break a Rule or Two
- The Power of Outsourcing for Supply Chain Improvement
Editor’s Note: The content of this post was originally published on Logistics Bureau’s website dated September 6, 2023, under the title “Current Logistics Outsourcing Challenges“.