How to Address Complex Shipping Logistics Challenges
Working with the right partner can smooth many of the bumps in the road for international logistics managers. Here’s how to keep up, address challenges, and maximize efficiency.
- Changing regulations and rising shipping costs have made choosing the right logistics partner an integral part of doing business.
- Pregis' Innovation Headquarters can help logistics managers optimize packaging shape, weight, and material choice.
- Balancing packaging sustainability and presentation can be a high-wire act, and Pregis' package R&D lab can aid logistics managers in designing environmentally friendly and aesthetically pleasing packaging.
- Pregis offers consultative services to help logistics managers generate solutions when more complex packaging issues arise.
What goes bump in the night and causes international logistics managers to wake up in a cold sweat? It’s not the boogeyman — it’s a constellation of complex factors all coming together to make moving boxes around the world a scary proposition.
Even before the COVID-19 crisis came and disrupted the global supply chain, the world of global logistics was going through a turbulent transformation. New rules and shifts in the regulatory environment often created conflicting requirements for trans-national shipping logistics. Shipping costs have been slowly rising. Vendor and supplier relationship management has turned into a full-time job. And customers have shifted their expectations, demanding more from brands in presentation, sustainability, and service. The world might be getting smaller, but only because international logistics managers’ headaches are getting bigger.
But each of these challenges is solvable, and every solution begins with an understanding of how these factors impact the global supply chain.
Regulatory compliance has always been a big factor in planning international commerce. Traditional worries have largely centered around tariffs, taxes, and restrictions on specific goods and materials — Algeria’s ban on importing toothpaste because of its fluoride content is a good example.
That’s changing on multiple fronts, though. First, no discussion of regulatory nightmares would be complete without mentioning Brexit. Great Britain’s departure from the EU has made shipping logistics between North America, the European continent and the British Isles a giant headache. It’s not so much that the EU has significantly different rules and regulations from Great Britain — at least not yet. Instead, it’s the fact that similar regulations and paperwork exist on both sides of the channel, but often with wildly different names and form numbers.
And in a world increasingly concerned about climate change and environmental degradation, sustainability regulations now require additional compliance overhead. Countries may limit the packing materials allowed or require that a certain percentage of the materials come from post-consumer sources like Britain’s Plastic Packaging Tax.
Rising Shipping Costs
The one small bright spot brought on by the COVID-19 pandemic may have been the brief halt, and occasionally even reversal, in a long pattern of rising shipping costs. Moving things from Albania to Zimbabwe has been getting more expensive, buoyed by rising fuel costs, increasing tariffs, increases in docking fees, and the raw cost of packaging materials going up.
Unfortunately, there’s not going to be much anyone can do about the price of fuel. However, there are plenty of variables a canny international logistician can control. Packaging shape and weight can reduce the two biggest drivers of freight cost. Packaging material choice, meanwhile, can reduce the per-package cost on the front end. Both can be optimized using a packaging expert, like those that work at the Pregis IQ.
On top of cutting costs from the initial shipping, selecting the right packaging can help drastically cut down on reships. Though that’s really a topic for the next section, it’s important to note here that returns and reships can take up as much as a quarter of a brand’s shipping budget.
The days when customers were happy to get a plain brown box full of packing peanuts are long gone. Fueled by rising concerns about the environment and sustainability and spoiled by a rise in Instagram-friendly direct-to-consumer brands, customers want more from the brands they’re buying from. Or at least from those brands’ packages.
For logistics managers, this can create a seemingly impossible choice: Focus on presentation and sustainability, but leave the contents of the package potentially open to damage (leading to a potentially negative consumer experience); or focus on protection, but leave the package lacking in “wow” factor and sustainability credentials. Neither scenario is optimal, and either one can leave customers feeling let down.
Of course, there’s a third option that allows the best of everything — protection, sustainability, and great unboxing videos — but for many logistics managers dealing with a million and one crises, that may feel like a bridge too far.
Reaching out to packaging suppliers can solve many of these issues. Pregis, for example, operates a state-of-the-art package R&D lab in the US, with packaging designers on staff that can take this particular challenge off client's hands. Similar services will soon be available in the EU. Many independent packaging designers can also coordinate this effort, leaving customers stunned with beautiful boxes that don’t break the bank.
Suppliers… or Partners?
Global shipping volume was already on track to shatter records in 2020 without the pandemic. With the pandemic, volumes exceeded even those already sky-high expectations. Logistics managers at brands, 3PLs, and other frequent shippers have been left scrambling to find partners that can help them meet the unrelenting march of commerce.
Of course, things aren’t as easy as just finding someone that sells bubble wrapping by the mile. With concerns about regulatory impact, shipping costs, and consumer expectations, the modern package pro needs more than a fly-by-night vendor who’ll ship some cardboard but won’t answer the customer service phone. More than ever, logistics managers need to find suppliers who really understand their challenges and are happy to lend a hand solving them.
While finding a true partner instead of just a vendor might seem like a lot of up-front work, it pays dividends every time a problem comes up. Instead of trying to solve a sustainability requirement, for example, a logistics manager should be able to shoot their account manager an email and get all the answers they need to make a simple, informed decision quickly. Or at the very least, put them in touch with a logistics and shipping consultant that can work through the challenge if it’s something more complicated than, “Is this foam plank made from recycled material?” Pregis offers this service to all of our partners, regardless of size, and logistics managers should expect no less from any packaging providers they work with.
Challenges and Opportunities Ahead
It’s safe to say that while the current shipping environment is fraught with challenges for logistics managers, the future will be even more so. But it’s also full of opportunities for brands, 3PLs, and other shippers to grow at unprecedented rates.
By understanding the challenges now facing global shipping logistics, preparing early for the challenges of tomorrow, and constantly staying on the cutting edge of innovations, companies can tap into these opportunities. Working together with the right partner, a trusted vendor, or consultant, can smooth many of the bumps in the road, and let logistics managers go back to making sure every package gets to exactly where it needs to go.
To keep up with changing regulations and maximize efficiency, consulting with a packaging expert like Pregis might be the right choice for your business.
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