Navigating International Shipments in 2022
There’s no denying that the past 2 years have been incredibly challenging. Whether you’re running a business or sending goods to a loved one across seas, international shipments have been hit this way and that. These issues span over all forms of freight movement. Ocean freight has been challenged by ports becoming congested and prices soaring. Hard lockdowns and consumer confidence caused the growth in air freight to plummet significantly. And a lack of HGV drivers has meant that even road freight has been presented with a host of logistical issues. Just as the thought begins to creep in that we may be sneaking back to normality, something else rears its head (omicron, for example) and throws everything back in array.
As Freight Forwarders, it is our job to successfully navigate this volatile industry and find the best deals for our customers. And, to do this, we believe in the benefits of open transparency into the real scope of the issues at hand. Once you understand the multitude of factors contributing to delays, price hikes and increasing demand, it’s easy to find practical solutions out of each mess. In this guide, we’ll take a look at how you can begin to navigate international shipments.
The State of International Shipments in 2022
It is predicted that most of the issues we’re currently facing will continue deep into the year. This is why accessing your supply chain strategies early on is the best way to come prepared to the field. Let’s take a look at the key aspects that are impacting freight movement across all forms of transport.
Increased eCommerce Activity
Hard lockdowns forced us to find alternative ways to spend our money. Online sales grew by 46% during 2020, making it the strongest growth for eCommerce in over a decade. Instead of popping to the local shop, we ordered everything from groceries to birthday presents online. In turn, this increased the demand on ports seeking storage solutions for all of these additional deliveries.
There has also been an increase in the number of people resigning from their jobs in search of a better home/life balance. Instead of looking for contracted hours, people are starting their small businesses. Relying on eCommerce and their online market, this is adding to the increase in demand, shooting up shipping prices and putting additional demand on international manufacturers too.
Extended Peak Season
Because delivery times are nowhere near where they once were, experts are predicting an extended peak season in 2022. Companies are ordering in bulk in a bid to prevent stock issues. The peak season has always been a time to focus on careful strategies, designed to remain in line with financial goals while meeting the needs of their end customer. This could see an extended period of high demand paired with continued higher shipping costs and delays spreading far further than previously seen.
HGV Driver Shortage
A combination of pandemic isolations and the impact of Brexit has caused the UK to be amid a significant driver shortage for HGV lorries. Many international drivers that we relied heavily on have left the UK while the average age of a driver sits at around 55 years old. Retirement has caused the industry to be in a deficit of around 1,000 drivers per week. And, the increasing cost of training is making the career prospect less appealing to younger people. There are fewer lorries on the roads, meaning that any available space is costly.
In January 2022, full customs declarations are required for all UK goods at the point of import. The original delays that allowed businesses to assess and better understand the changing rules has now come to an end. And, if those businesses haven’t found strategic ways to navigate this, we could start to see delays in shipments during the coming months. Pair this with the recent change in legal requirements for product labelling and potential customs delays and the costs could be traumatic for many supply chains.
The omicron variety is continuing to cause numerous delays for businesses. Staff shortages, factory closures and actions to reduce spread are all impacting everyday workflow. And, this is having a known effect on everyone.
Global Container Shortage
The bottleneck caused by container shortage is expected to continue posing an issue throughout 2022. Kicked off by the national lockdowns back in March 2020, the closure of manufacturing sites and reduction in sea freight meant that empty containers became a rare commodity. There is also a hesitance by shippers to book in advance, for fear that last-minute changes will cause financial complications. Some experts predict that this could mean a demand spike later on in the year which will push prices even higher than we are seeing now.
What Can Your Business Do?
While we cannot directly dictate shipping costs, delays or shortages throughout our supply chain, we can take strategic measures to minimise the impact they have. Working with an experienced and professional freight forwarding company is one way to do this. These relationships provide you with insider knowledge and a wealth of contacts that will seek to find the best deals on every shipment. Other considerations to make include:
- Implementing data and technology to track your shipment accurately. This way you can adjust launch dates, advise customers and keep the stream of communication open to maintain a good brand reputation.
- Consider expanding your business. Look for ways, other than stock-dependent solutions – to expand your business and understand your costs.
- Look into different forms of freight to your normal solutions. Many businesses shy away from air freight because of the increased costs. However, if convenience and practicality are holding you back with your normal transportation method, you may wish to consider air freight or rail freight as viable alternatives.
- Consider LCL shipping strategies where space may be easier to find within the restricted capacity market.
- Look for ocean carriers that are considering IPI (interior point intermodal) cargo instead of port deliveries. These are suggested as a practical solution to avoid the bottleneck seen in over-congested ports.
Navigating international shipments in 2022 will likely be a continued challenge. This is why you need the right team by your side to support you. Whether you’re shipping vehicles, food or clothing, we have a team of highly skilled and experienced freight forwards to support you here at Radius Warehouse and Logistic Services. Get in contact today for a quote or to discuss your requirements in more detail.