Global Trade Recovery: Preparing for the 2022 Supply Chain

2021 was the year of the supply chain. In this QAD Precision Report, we look at what’s to come for global trade and transportation and how to prepare for the unknown in 2022 and beyond. 

With homes being transformed into makeshift offices, gyms, and screen-reliant classrooms, and businesses adapting to growing demand and changing regulations, it is no surprise that COVID-19 completely changed how the world operates. In 2021, we witnessed a dramatic shortage in shipping containers, chips required for electronics production, truck drivers and general laborers, and more. All of which caused severe bottlenecks in the supply chain.

The common denominator of these disruptions is the fractured supply chain. Demand is exceeding supply while inflation skyrockets. No industry has been immune to the impacts of the exhaustive disruptions, and band-aid solutions simply aren’t enough. 

All is not lost, however. As we look to the year ahead, there are many ways companies can prepare to navigate unpredictable supply chain logistics.  First, let’s look at what we’re up against.

Hope for the Best, Prepare for the Unknown

With inflation hitting the United States at a 30-year high and rising, coupled with potential impacts of a new variant, one thing is guaranteed: the global economic outlook for 2022 is completely uncertain, according to the UN Conference on Trade and Development (UNCTAD). 

While the latter half of 2021 saw strong economic gains, UNCTAD claims this uncertainty is caused by “demand due to subsiding pandemic restrictions, economic stimulus packages, and increases in commodity prices.”

The overall nervousness surrounding the pandemic and its aftershocks, such as new variants, more lockdowns and halted production on factory floors, have ultimately led to immense global supply chain issues. For example, getting products out the door to customers is a difficult task (i.e. logistical hassles like cargo ships idling outside of ports and truckers waiting in exasperatingly long lines outside of loading docks). These disruptions have not eased much this year and are predicted to spill over well into 2022.

While these supply chain issues are likely to persist, there are ways global companies can remain agile and flexible to stay ahead in the coming year.

Looking Ahead: Preparing For 2022 (and Beyond)

Struggling through persistent supply chain woes is not only stressful, it’s harmful to the bottom line. Despite bottlenecks, e-commerce continues to undergo fantastic booms. Managing these volumes and keeping up a high level of customer service is no easy task.

With material, transportation and labor scarcities, going into a new year with the same challenges is undoubtedly overwhelming. 

From a product leaving the manufacturer to arriving at the customer’s front door, an experienced global trade partner can help navigate a supply chain in the midst of recovery. To prepare for the year ahead, companies should prioritize two areas of their supply chain: Transportation and Compliance.

TRANSPORTATION AND SHIPPING SOLUTIONS 

A huge kink in the supply chain this year has been in transportation and logistics - with a shortage of cargo ships, truck drivers and raw materials, just to name a few issues. To curb these challenges and help meet deadlines and quality control standards, QAD Precision’s transportation solutions can help mitigate challenges, including:

• Transportation execution - integrate into a worldwide carrier network for inbound/outbound shipments, giving you the power of choice while still maintaining uniform shipping procedures across your enterprise.

• Multi carrier shipping - compare carriers to secure the best rates, transit times and arrival dates based on the unique details of each shipment.

• Delivery exception - oversee all shipments as they move through the carrier network using a global delivery tracking software with real-time alerts.

• Transportation analytics - view real-time operational insight across all your shipping operations for the current day or a date range. At a glance you can see what is happening across all your shipments, monitor key performance indices and proactively take action if and when issues arise. 

• Freight bill audit pay - gain more visibility and control over shipping spend. A robust freight invoice auditing solution can help identify consolidation opportunities, cut unnecessary freight and trim costs by making smarter transportation decisions. 

Overall, these flexible and customizable solutions increase efficiency and deliver shipments on time at a low cost and with far less uncertainty.

GLOBAL TRADE COMPLIANCE SOLUTIONS 

Navigating global compliance is overwhelming, but meeting international regulations is essential in an efficient supply chain. Compliance management solutions keep materials out of the wrong hands, help avoid fees or penalties due to audits and customs issues, and streamline international shipping processes. QAD Precision's global compliance management software offers solutions for:

• Import and export management - automate import/export processes, documentation production and customs reporting, adhere to regulatory requirements and reduce the hidden costs associated with global trade.

• Free trade agreements - easily assess your entire product line under FTA Rules of Origin, obtain a full detailed audit trail of the results, and generate outbound and solicit Certificates of Origin. 

• Foreign-trade zones - enable manufacturers and distributors to maximize the benefits of FTZs.

• Restricted party screening - program and automate compliance screening to perform due diligence, stay up-to-date with denied parties lists and create audit-ready electronic reports.

• Trade compliance analytics - survey on-demand dashboard views of key operational statistics, along with metrics and trends. These include the number and types of shipment holds as well as Restricted Party Screening volume.

While the future is uncertain, we can guarantee one thing: having the right technology in your global trade toolbox will ensure companies have the agility and flexibility to meet whatever challenge comes their way. The first step is to partner with an experienced global trade management provider. Then, unlock the value, predictability and ROI that is key to navigating the supply chain in 2022 and beyond. 

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Further Reading:

KEY CHANGES IN THE HARMONIZED SYSTEM 2022

THE BENEFITS OF INTEGRATING COMPLIANCE AND MULTI CARRIER SHIPPING SOLUTIONS

QAD PRECISION SOFTWARE UPGRADE ENHANCES SUPPLY CHAIN VISIBILITY AND CONNECTIVITY