Comparison chart: the advantages and disadvantages of the Logistics and Supply Chain
Trends in 2023
Name: Marcos Andres Camargo Sandoval
C.C 1140880150
Advantages
Challenge of making any supply chain
and delivery predictions in such a
dynamic economic and political
environment.
Embedding green logistics practices
across the supply chain – particularly
through sustainable eCommerce
fulfillment options and delivery operations
– will help supply chains reduce their
carbon footprint, maintain a competitive
advantage and even increase market
share in 2023 going forwards
Today, retailers must take a good look at
providing the best possible service while
increasing operational efficiency. This
has resulted in a shift of priorities when
selecting delivery management platforms:
from consumer experience and customer
service, to cost optimization
A more globalized presence requires a
larger, highly skilled workforce. In the
face of an ongoing shortage of supply
chain workers, companies are ramping up
benefits to get younger generations
interested and investing in training
solutions to upskill their teams
As technology expands data collection
and analysis capabilities, organisations
will be expected to provide even more
detailed reports on their supply chains'
various environmental, social, and
financial aspects. Governments will
continue to establish and refine
environmental, social, and governance
(ESG) reporting guidelines as part of
Disadvantages
Increases in fuel, disruptions in supply
chain, and increased labor costs have
severely impacted retailers’ margins
On the consumer side, higher prices
and erosion of real wages by an average
of 8.5%, have led to less overall spending
and an increase in online shoppers
looking only for deep discounts and
special offers
While the old adage that the “customer is
king” may still be true, retailers cannot
ignore that the pandemic induced hyper
growth phase of eCommerce has
passed. Now that growth has slowed and
margins are tight, many retailers find
themselves guided by keeping a lid on
costs rather than pleasing customers
Due to a significant decrease in orders,
labor shortages and supply chain
uncertainty, 59% of small retailers could
be shutting down over the next year
Larger retailers such as Macy’s and
Walmart are better equipped to weather
the storm caused by lower sales growth
and lower prices. For other retailers,
however, it’s significantly more
challenging
sustainability initiatives
All those new technologies and multiple
fulfillment methods that were
implemented to get through the tough
times, translate into increased efficiency,
more satisfied customers and increased
profits once the economy gets rolling
again
For those retailers who can meet today’s
challenges, there is positive news on the
horizon and reasons to be optimistic
about the future. According to the IMF,
inflation is expected to fall to 4.1% by
2024. By all indications, eCommerce will
continue to grow at a healthy pace for
many years to come
After experiencing shortages throughout
the pandemic, many businesses over
ordered inventory to compensate. But
thanks to severe port congestion and
other delays, many items ordered over a
year ago are just now hitting the shelves
— and new influxes of inventory have
nowhere to go. Businesses are trying to
reduce warehousing costs and move
inventory quickly to make room.
Additionally, increasing inflation means
consumers are short on buying power so
lower demand could compound
oversupply in 2023
It’s clear that climate change has
increased the frequency and intensity of
extreme weather events, and despite
recent strides in climate change
mitigation, extreme weather will still be
prevalent in 2023.
In addition to the toll these events take on
individuals and communities, they also
can negatively impact global supply
chains via transportation limitations,
factory shutdowns, and suspended port
operations. These disasters also impact
infrastructure, causing damage that may
shorten the lifespan of vehicles or vessels