Global supply chains weren’t exactly humming along before the COVID-19 pandemic, but the supply and demand issues of the past year have “revealed how fragile supply chains can be,” wrote the authors of a February 2021 Deloitte Insights report titled “Creating a competitive supply chain advantage through connected communities.”
Deloitte is one of the world’s largest accounting and professional services firms.
The pandemic has also created new opportunities for transportation and logistics providers to gain an edge through connectivity, according to the report, based on an online survey that Deloitte commissioned that gathered responses in early 2020 from 182 supply chain leaders in trucking, ocean, rail, manufacturing and retail.
One of the biggest hurdles and opportunities in the supply chain is fragmentation. The trucking market has “small players and tighter IT budgets,” the authors noted, and 90% of the 470,000 US trucking carriers (about two-thirds of total trucking capacity) are operating fleets of six or fewer trucks.
A number of technology companies have built digital freight exchanges to fill the gaps caused by market fragmentation. The platforms connect capacity to cargo and generally target the spot trucking market.
Digital exchanges have 48% participation in trucking, according to the report, “but still have a long way to go.” Deloitte recommends consolidation of exchanges to improve the digital freight landscape. It will take more than digital exchanges and data sharing for supply chains to return to normal, however.
