The delivery capability is evaluated at goods receipt

Unreliable freight traffic worsens the delivery reliability of suppliers and customers.

In addition to product functionality, quality and price, logistical performance is also an intrinsic product feature. From the customer’s subjective perspective, the supplier’s logistics service ends at its own goods receipt and not at the supplier’s goods issue. Having your own goods ready for dispatch on time is a necessary but not a sufficient condition for logistical performance. The reliability of transportation to the customer also contributes to the overall logistical performance of a supplier.

If goods are not received on time, the opportunity costs of the missing sales quickly exceed the cost savings of low-cost procurement. It is not only the automotive industry that is currently experiencing this painfully. Virtually all companies, at least those that source in the Far East, are currently experiencing this.

Global freight performance is still severely restricted. At the end of November 21, 8% of global ocean freight capacity was congested at the major international container ports of Ningbo-Zhou, Pearl River Delta, Los Angeles and Savannah alone
. On the Asia-Europe freight route, the average delay of container ships to Europe is currently 16 days and only around 1/5 of ships arrive on time. Increased blank sails to make up for missed deadlines cause further uncertainties

There are many indications that the bottlenecks will continue for some time, at least in China, where they will be exacerbated by production losses due to lockdowns.

You don’t just have to look at sea freight to realize how sensitive transport services are to the availability of goods. In the UK, supermarket shelves remain empty due to a lack of truck drivers. In Germany, too, there is reportedly a shortage of 80,000 truck drivers and it is expected that there will be a shortage of around 15,000 more drivers every year

As long as the coronavirus pandemic has not subsided internationally, we will have to expect further bottlenecks on international freight routes. The capacity bottlenecks in land transportation could also increase further in the coming years if technology does not make significant leaps forward or the pay of truck drivers is not significantly improved. In terms of fuel savings, platooning has not yet shown the success that had been hoped for
but it may help to compensate for part of the shortage of truck drivers. We are probably still years away from autonomous truck journeys.

From the consignee’s point of view, the only thing that helps in such a situation is to plan security times for free deliveries and to reserve freight capacities in good time for ex-works deliveries. The same applies to consignors with regard to free deliveries.

The prerequisites for all these measures are the best possible demand forecasts, accurate calculations of safety stocks and procurement lead times. Those who have upgraded their planning processes in good time and implemented them consistently now have a clear advantage!

Picture of Prof. Dr. Andreas Kemmner

Prof. Dr. Andreas Kemmner

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