Much has been written about the impact of the Coronavirus disease (COVID-19) on global supply chains and the extent to which the pandemic stoked panic buying of essential products. Faced with huge swings in consumer demand, consumer packaged goods (CPG) manufacturers had to pivot overnight, as did carriers and retailers, all while adapting to the “New Normal” of health and safety precautions, new processes and shifting regulations.
Predicting the future is never a sure thing, but some of the temporary policy measures during the COVID-19 crisis, taken together with recent innovations and technologies adopted by industry, point toward areas ripe for regulatory reform and refinement.
The pandemic exposed new opportunities for safe, common-sense solutions that would safely and effectively strengthen America’s supply chain for years to come:
In response to increased demand during the pandemic, the Federal Motor Carrier Safety Administration (FMCSA) rolled out a finalized rule for enhanced trucking hours of service flexibilities and suspended hours-of-service rules for qualifying deliveries. Individual states also temporarily increased truck weight limits, effectively demonstrating those trucks’ ability to operate safely nationwide.
Together, these changes greatly helped to moderate available trucking capacity and ensure the safe, timely movement of goods during a time of national need. If made permanent, these actions could bolster supply chain competitiveness and streamline operations across myriad industries.
Additionally, FMSCA listened to input from shippers, carriers and retailers about the need for added flexibilities for license renewals, vehicle registrations, drug and alcohol testing and many other day-to-day business issues that grew increasingly complicated as state DMVs shut down or suspended normal hours of operation. The pandemic exposed the degree to which these activities could be made electronic and more uniform across states. Taken together with broader trends toward telework, there is opportunity both at the state and national level to simplify and standardize processes.
While government transportation officials primarily sought to ensure access to capacity, industry efforts throughout the COVID-19 crisis emphasized the need for efficiency, safety and visibility throughout the supply chain. Legislation, especially a transportation reauthorization package, stands to have the most significant impact on the movement of goods and services. Potential changes, like a national truck weight limit increase, or even the creation of a data collection pilot, are essential to strengthening the supply chain.
Pre-COVID-19, the Department of Transportation restarted its national freight strategic planning process, which has been in the works for years. It is imperative that this plan not only gets finished, but is also effective and results in meaningful change.
The CPG industry has and will continue to emphasize the importance of efficiency, safety and visibility within its supply chain. Progress continues to be made in response to other regulations like the FDA’s Food Safety Modernization Act and the European Union’s guidelines on Good Distribution Practice for medicinal products. Moving forward, technology and information-sharing will underpin safety and traceability regulation, thus impacting goods transportation practices and requirements. The shift from traditional retail to e-commerce during the pandemic poses additional regulatory and liability questions that remain unresolved, especially as it pertains to food safety and potential illness.
It’s the last point that stands to perhaps most significantly shape future regulation and business practices. In prompting additional conversations around health and safety — and in encouraging shippers, carriers and retailers to rethink transportation processes with the aid of technology — COVID-19 seems likely to spur regulation and policymaking tied to information sharing, electronic transactions and chain of custody.
Industry efforts, such as the Consumer Brands Association’s Contactless Delivery Task Force, are rooted in evolving conversations about how to document each step in the supply chain. The interplay between blockchain/distributed ledger, cold chain and delivery transaction technology will have significant implications for industry in the years ahead, sometimes making it easier to do business, while in other cases requiring additional levels of compliance and risk mitigation. It’s clear that in a post-COVID-19 world, the need to monitor and record shipments is only going to grow more complex.
The Coronavirus outbreak exposed supply chain shortcomings, but it also provided a roadmap both for future policy-making and industry investment. These anticipated changes may be less surprising than the pandemic itself, but will have a similarly outsized impact on transportation and logistics in the years ahead.