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Keep Your Seatbelts Buckled. Don’t Expect A Return To Supply Chain Normalcy In 2023.

By December 29, 2022July 28th, 2023No Comments

A couple of news articles lie on my bedside table reporting that the supply chain is back to normal. As I read them, I scratch my head and open my dictionary to refer to the definition of normal. According to Merriam-Webster, the definition of normal is conformance to a standard, or regular pattern : characterized by that which is considered usual, typical, or routine. While supply chain leaders are ready to say goodbye to 2022, supply chain operations are far from normal.

While the uneducated might argue that the supply chain is back to normal as goods are moving more freely avoiding the logistics snarls of late 2021, they are wrong. Logistics is only one of many factors supply chain teams balance each day. The pressures on the supply chains continue, but are shifting taking a new form. The primary issues are no longer logistics. For example the daily spot rate to move a container from Asia to the U.S. west coast is now at $1,400 down from $15,000 a year ago. Container trade is down 30% on Asian-U.S. trade lanes, and large manufacturers like P&G report a reduction in transportation and warehouse spending of $100M less than budgeted for 2023.